Nakheel Retail, a subsidiary of real estate developer Nakheel, will be investing more than Dh3 billion to develop 13 million square foot of retail space across five separate projects in Dubai by 2012, a senior company executive said.
“Our foray into retail sector is totally demand-driven, as Nakheel is building residential units for three million people in the next two decades,” Graham Dreverman, Group Managing Director, Nakheel Retail, told Emirates Business.
The new retail space will be built across five projects: Palm Mall, Palm Jumeirah; Palm Mall, Palm Deira; Ibn Battuta Mall Phase II, doubling the mall’s size with new themed courts and an expanded retail mix; India Mart, an Indian wholesale and retail shopping with entertainment facilities; and Great Mall Dubai, a three-in-one mall concept at International City.
The firm plans to be among the top 10 companies owning and managing retail properties in the world by 2018, he added.
“With the design and delivery of five new innovative, world-class shopping malls, Nakheel Retail is poised to become one of the most successful shopping mall developers, managers and owners in the world.”
Dreverman said he is optimistic of starting work on the five projects by end of the year. Construction work has commenced at Ibn Battuta Mall and Palm Mall in Palm Jumeirah.
“We will definitely start work on four projects by the end of the year and one by first quarter of next year. We are speaking to four to five ‘A’ grade contractors.”
Asked how much will the retail division contribute to Nakheel’s revenue, Dreverman said: “We will be growing at a much faster pace than Nakheel. We expect a double digit growth, while the contribution to bottomline will be significant.”
Gross leasable area (GLA) in Dubai is set to treble to 4.25 million square metres by 2010-end, from 1.37 million square metres in 2006, according to an earlier report by Colliers International.
The retail real estate market in the Gulf Co-operation Council is the fastest growing in the world and about 16.35 million square metres of GLA will be completed by 2010. The increase represents a 565 per cent growth in the available GLA in the region since 2000, up from 2.46 million square metres at the start of the millennium.
Nakheel Retail will open eight hyper-markets and 12 supermarkets across Dubai in the next 12 months.
“Our projections are to touch 40 hyper and supermarkets by 2018,” Dreverman said. The company will also be exploring opportunities in other emirates and countries as well.
“We will be exploring opportunities around the globe and in other emirates. We will take this concept to other emerging markets,” he said. The firm will also look at acquisitions.
New structure key to progress
Nakheel Retail Shopping Malls is the retail property division of Nakheel Retail undertaking ownership, development, management, leasing and marketing of shopping malls located around Nakheel’s residential communities.
Nakheel Retail’s RetailCorp is already a dominant operator in the sports sector through a mix of franchise and joint venture agreements with brands, including Lillywhites, Sports Direct, Dunlop, Slazenger, Karrimor, Carlton, Donnay, No Fear, Kangol, Voodoo Dolls, Antigua, Lonsdale, Nike, Go Sport and Peak Performance.
New retail brands for Nakheel RetailCorp will focus on general apparel, sports, entertainment and leisure, cinema and home sectors.
Nakheel Retail Hypermarkets complements the other retail platforms dedicated to establishing an international hypermarket that will set the benchmark for the region. An announcement regarding a partnership will be made shortly.
Nakheel Retail Food & Beverage will target the market in the region. By embracing the cuisines of the world, it will become the largest and most diverse food and beverage operator in the UAE within five years.
Nakheel Retail Shopping Malls division’s existing asset portfolio includes more than two million square feet, including the world’s largest themed shopping centre, Ibn Battuta Mall and Chinese centre Dragon Mart.
Nakheel plans retail projects worth Dh3bn