If you build it they will stay, research tells Abu Dhabi malls

Abu Dhabi’s retailers have the opportunity to soak up excess consumer demand for new entertainment and dining options that is spilling over into other emirates by updating their mix of restaurants and attractions.

Three in every 10 Abu Dhabi consumers visit shopping centres outside the emirate at least once a week, according to research commissioned by Gulf Related, the developer of Al Maryah Central, the US$1 billion shopping mall due to open in Abu Dhabi in 2018.

Sixty-eight per cent of customers visit malls outside Abu Dhabi at least once a month, the survey found. It was conducted by market research firm Brunswick Insight.

Almost half of consumers said that they travel for the entertainment options on offer outside Abu Dhabi, almost a third want to buy something that isn’t available in the local market and just under a third of consumers want to eat at restaurants loc­ated outside of the emirate.

“What we hope to do with our new centre is to convince a lot of the shoppers who are travelling elsewhere for their retail experience that Abu Dhabi has enough to offer and they don’t have to drive to Dubai,” said Kevin Ryan, Gulf Related’s chief operating officer and managing director.

Mr Ryan said that his company planned to use the research to “tweak” the tenant mix and designs for the 2.8-million-square-feet Al Maryah Central mall, which is being developed next to the Galleria luxury shopping centre on Al Maryah Island.

He said the company had decided to increase the amount of space it was dedicating to entertainment and double the size of one of the “parks” it is developing in the centre. He said that the decision to increase Al Maryah Central’s entertainment offering was independent of plans by the developer of the nearby Reem Mall on Reem Island to include a snow park.

Yas Mall, which opened in 2014, has shown that some of the consumer demand for new attractions can be satisfied ­locally, according to analysts.

Craig Plumb, the head of research in JLL’s Dubai office, said it was still likely, however, that Abu Dhabi consumers would continue to show interest in retail options outside the emirate even after the local shopping and entertainment scene expands further.

“I think it’s fair to say that there will be a number of people in Abu Dhabi who go to Dubai regularly to shop and other things [and] new malls in Abu Dhabi could soak up some of that demand,” he said. “However, it’s very hard to say how many of those people just go to ­Dubai to shop and how many are going there for other things as well such as seeing family and friends or work or a combination of those. But at the end of the day Dubai is a much bigger city than Abu Dhabi with more attractions in it, and so I think some people will always travel to Dubai from Abu Dhabi for leisure.”

Al Maryah Central’s developer is also enhancing its food offering, which will now include an 80,000 sq ft food hall known as Central Kitchens, which will have 26 cafes and restaurants. About 20 per cent of the space in Al Maryah Central and the Galleria – about 100 units – will be dedicated to food and ­beverage.

KPMG has said that the supply of new F&B outlets and concepts is outstripping demand in the UAE amid a softening in consumer spending as the low oil price slows economic growth.

“Industry standards for the amount of food and beverage have been increasing and now 20 per cent to 25 per cent is pretty normal for the supportable ratio,” Mr Ryan said. “We’re not even pushing the upper limit. Yes, in theory at some point things can get over-saturated. But if you’re the first mall in Abu Dhabi and generating the level of footfall we anticipate then we should be able to support that level of business.”

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