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Sharjah 2016 | ECONOMY | FOCUS: RETAIL INDUSTRY

As demand for retail space rapidly increases, a number of retail developments are being added to the government and real estate developers' agenda, boosting both employment and the contribution the sector makes to Sharjah's GDP.

As the UAE increasingly moves toward a service-based economy, retail sales becomes an important economic indicator. Concerns over a slowdown in the UAE's economic growth have not diminished consumer confidence; in fact, the overall UAE retail industry is growing faster than the economy as a whole, and is expected to grow by 5% both this year and in 2017, when it is set to reach AED200 billion.

Rapid population growth and increased numbers of visitors, in line with the government's tourism strategy, are making retail one of Sharjah's most promising sectors, encouraging both local authorities and the private sector to support the development of the industry. Sharjah has announced its retail industry expansion plans of adding 3 million sqft of shopping malls by 2020. As well as extending existing malls in the city, new retail centers are being created in the city's outskirts, mainly near the numerous master-planned community developments that have flourished in recent years. Sharjah's largest shopping mall, Sahara Centre, has already been expanded by 60% when an extra 1 million sqft was added to it, while City Centre Sharjah is currently being expanded by more than 409,000sqft. Whilst this may sound impressive, the biggest developments will be the greenfield mall projects outside of the city.

One of these projects is being developed by the Dubai-based conglomerate Majid Al Futtaim. The Al Zahia project is an AED30 billion investment to build 10 new mega malls across the UAE over the next 10 years, which would directly and indirectly create 170,000 jobs nationwide. One of these projects is a 'super regional' mall in Sharjah, adjacent to the master-planned gated community. The new mall, which will be called City Centre Al Zahia, will extend over 1.4 million square feet and is the largest mall under development in the UAE. With its strategic location on Sheikh Zayed Road, which connects Sharjah to the other emirates, the mall is expected to attract shoppers and visitors from all across the region.

Another complex being developed to satisfy Sharjah's growing demand for retail space is 'Zero 6'—a reference to Sharjah's dialing code. The 37,000sqft shopping mall is in the hands of Sharjah-based developer, Alef Group, and is the first of a series of 'Zero 6' malls planned by the group across the emirate.
On Sharjah's waterfront, the International Private Group and Gambert Architectural have partnered with Canadian designer OpenAire to develop Sharjah Mall, an iconic 300,000sqft shopping mall, due for completion by 2020.

Lastly, Tilal City, the mega-project mixed-use complex being developed by Sharjah's Tilal Properties, will include a 1 million sqft shopping center as one of the community's main attractions.

The impact of the retail industry's rapid growth is impressive. The most direct effect of a rising retail space demand is the opportunity for constriction firms and developers. In recent years, Sharjah's real estate sector has experienced tremendous growth and has become a pillar of the Emirate's economic development. Another important aspect of a robust retail industry is the creation of value chains. As consumers demand more goods, they feed a complex value chain by which retailers order more stock, factories purchase more raw materials to manufacture more goods, and so on. Of course, retail also boosts employment. In advanced economies, retail is one of the largest providers of employment across entire value chains, from manufacturing to human resources, from research to design, from administration to handling and so on, providing employment opportunities to both the skilled and unskilled labor force.

The UAE's retail industry is ranked as the eighth most attractive market in the world. And with retail set to become an even bigger focus for the economy, there is no doubt the government is once again on the right path to prosperity.


 

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