Doha: Qatar’s retail industry witnessed a robust demand in prime areas, while the market experienced an oversupply from April to June.
According to a report by Cushman and Wakefield, the surge in travelers flowing to the country also contributed to a reported increase in footfall across Qatar’s main malls during the first three months.
Hence, the same has reportedly been maintained during the second quarter of the year.
Mall managers across the country have also indicated that there will be an increase in spending in 2024 compared with last year.
No significant new retail enhancements were introduced in the quarter, however, market analysts confirm that Doha Mall will open fully next month, following the opening of its anchor tenant Lulu in the first quarter of 2024.
The report said: “Organised retail supply in Qatar’s malls is approx. 1.6 million sq m.
This supply is supplemented by more than 400,000 sq m of leasable space in ‘open-air’ retail/F&B destinations, which includes The Pearl, Souq Waqif, Souq Al Wakra, Msheireb Downtown, Katara, Doha Port, and Lusail Boulevard.”
Similar to the office realty market, occupancy rates vary between some of the main localities and the wider market.
In the second quarter, Doha Festival City joined Villaggio Mall in registering full occupancy rates after leases were agreed on the remaining available units.
However, newly introduced malls such as Place Vendome continue to draw retailers with resilient “pent-up” demand for ground floor units and from luxury retailers as the project increases its footfall.
The report further mentioned “In the wider retail market, the overall increase in supply in the past five years has led to a number of malls struggling to attract footfall, with vacancy rates growing. Cushman and Wakefield estimate that approx. 20 percent of retail units within organised malls are currently vacant.”
Likewise, open-air developments, that are exposed to reduced footfall during the summer period are increasingly permitting flexible lease terms and rental incentives to attract and retain tenants in an increasingly competitive market.
The data noted “Standard line units of approx. 120 – 250 sq m in Doha’s main malls typically rent for between QR220 and QR280 per sq m per month.
Smaller-sized outlets in prime locations usually command between QR300 and QR400 per sq m per month.”
Analysts stressed that Qatar’s retail shops which witnessed footfall drop following the opening of Doha’s super-regional malls, have vastly reduced their rent to below QR200 per sq m per month for line units.
Outside of the organised retail malls, retail showrooms are typically available to lease for between QR80 and QR140 per sq m per month.
“Restaurants and cafés in some of Qatar’s most popular outdoor destinations, typically generate rental incomes between QAR 130 and QAR 180 per sq m per month,” it added.
On the other hand, mini retail marts and grocery stores in residential areas are significantly given for rent between QR4,000 and QR10,000 per month, according to their unit sizes.
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