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A well-thought-out urban design policy is in effect in residential neighbourhoods where community malls are springing up. Last year's results show that the return on investment of these community mall developments is high. They are also making many neighbourhoods more attractive and positively affecting property values.
''There is a definite demand emerging for small community malls,'' David Godchaux, CEO of Core-Savills, UAE, tells Property Weekly. ''Community centres in newly completed residential and commercial clusters meet the residents' needs comprehensively. They do not want to go to crowded malls full of tourists. It brings cash flow for owners and operators. It also helps the developers and operators of new communities to generate cash flow.''
In Dubai, as many as 20 community shopping malls may come up in the run-up to the World Expo 2020, with many close to the expo site in Jebel Ali. An average community mall is about 80,000 sq ft, with the supermarket anchor tenant taking up as much as 25,000 sq ft. Each mall comprises 20-30 retail units with an average size of 1,000 sq ft.
While these projects are small compared to Dubai's mega retail projects — Dubai Holding's Mall of the World is a 48-million-sq-ft project, for instance — many retail developers are now setting their sights on fast-growing residential communities such as Victory Heights, Jumeirah Golf Estates, Jumeirah Village Triangle, Jumeirah Village Circle, Motor City and Arabian Ranches.
Emaar and Meraas are very visible in creating neighbourhood retail spaces. The newest and one of the most eye-catching of these developments is Boxpark Dubai, a strip mall made up of 220 shipping containers on Jumeirah's Al Wasl Road. The colourful and quirky 18,500-sq-m development is being built by Meraas Holdings, which is also behind City Walk on Al Wasl Road and The Beach in Jumeirah Beach Residence.
Nakheel's retail projects launched in the past two years include community retail centres at Jumeirah Park, Al Furjan, International City, Discovery Gardens and Badrah. Humaid Zayed Al Nuaimi, Head of Leasing of Nakheel Malls, said at the sidelines of the Future Retail Summit in Dubai last year that community malls will be a focus of the group in the next year. Analysts at the summit also discussed how increasing demand from communities on the outskirts of Dubai is being catered to by these developments.
Ali Rashid Lootah, Chairman of Nakheel, said that along with large-scale malls, ''souq-style complexes'' are part of the developer's retail expansion strategy, which will see it create 10 million sq ft of leasable space.
Vipen Sethi, CEO of Landmark Group, tells Property Weekly, ''Mega malls are playing a significant role in bringing retail to the forefront, making Dubai a leading shopping and entertainment destination for tourists across the globe. Community malls, on the other hand, are more focused on the resident population. They serve the immediate needs of large catchment areas and provide for the day-to-day needs of the community.
''The presence of a community mall positively impacts neighbourhoods and raises the profile of the catchment area.''
Landmark's Oasis Centre is one of the early models of community malls that have opened in the city.
Community malls are a part of a larger urban design policy for Dubai. While developers have all announced plans for such projects, Dubai Shopping Festival 2013-14 for the first time included small centres as well. The Shop and Win promotion, for instance, was targeted at centres that have less than 100 shopping outlets. Among the malls and shopping centres that participated in the promotion were Al Ain Centre, Al Bustan Centre, Barsha Mall, Bin Sougat Centre, Century Mall, Etihad Mall, Madina Mall, Mazaya Centre, Karama Centre and Times Square Centre.
''It was a good move,'' says Godchaux, adding that DSF has been dominated by the larger destination malls so far. ''Tourists head to the destination malls, which give you an experience, like a theme park. Residents, however, want to grab bargains without battling the DSF crowds.''
Godchaux says the trend is part of a bigger picture where the city is becoming more resident-friendly and global in nature. And this has not gone unnoticed, with Dubai's achievements highlighted in the recent Savills 12 Cities Report.
''Over the past two to three years, Dubai is becoming a city to come and live in,'' says Godchaux. ''It is a global city trying to capture investors from the region and around the world. We see Dubai becoming more confident, a safe haven in a large region that is not very stable. Dubai is going to be the place where money is invested. It is developing infrastructure not just for the tourists, trade and industry but also for residents.''
Some of the mall developments have appeared in areas that were always considered high-end residential hubs, such as Al Wasl Road and Jumeirah Beach Road. ''Existing freehold communities have very little space. Developers as well as buyers are looking for something different,'' explains Godchaux. ''These areas provide unique space and a new experience. These are absolute strategic locations.''
City Walk, the first freehold development in the area, will also launch a residential component of five - and six storey towers, which Godchaux says will be representative of a new urban lifestyle.
Sethi adds, ''Al Wasl Road and Jumeirah Beach Road have a large catchment of residents who are looking for high-quality shopping and recreational outlets to form a part of their community. These projects built in and around the vicinity provide residents with easily accessible retail and food outlets.''
Certainly, communities are regaining importance all over the world. New projects being built in communities, on the other hand, are likewise becoming more relevant to the lifestyle needs of residents. JWT's 100 Things to Watch in 2014 report states, ''Watch for the model, which taps into consumers' interest in supporting local businesses, to spread to more categories. Community supported agriculture [CSA] is a way to boost regional farmers and keep the larder well stocked with produce or meat. Now the concept — paying upfront in exchange for a share of regularly delivered goods that are a bit of a surprise in terms of content — is branching out. Flower CSAs are springing up, and there are art CSAs in Brooklyn and Philadelphia.''
The trend gains in importance as urban planners the world over look for ways to fight traffic woes. Living next to a shopping centre no longer means living under a vast shadow of one of the world's largest malls. ''Community malls in Dubai are emerging because so far large malls have been dominant,'' says Godchaux. ''It's a trend in most cities around the world. It's always easier to go three minutes from where you live.''
In the UAE too, other emirates have their own community centres. Statistics from the Middle East Council of Shopping Centres show that the most successful Carrefour is Deerfields Mall in Abu Dhabi, which at 80,000 sq m is a rather large community mall.
Majid Al Futtaim (MAF) Group has opened its first My City Centre in Nasseriya, Sharjah, with a retail space of 5,540 sq m and 21 stores — the full-format City Centres in Deira and Mirdiff come with around 370 and 460 stores respectively. MAF is creating four community malls through Sharjah Holding, a joint venture with the government of Sharjah. The group has announced plans for two neighbourhood malls in Sharjah and an expansion of My City Centre with locations under discussion.
Community malls are not a new concept, however, it is only recently that they are gaining prominence with residents. Sethi says, ''Community malls have been present across the region since over a decade. Oasis Mall as a brand is over 15 years old and we already have four malls across the UAE, Saudi Arabia and Bahrain.''
The difference, he says, is in numbers. ''Back then, the population in the region and retail development was much lesser. Today the numbers have changed. With a growing population and new upcoming residential communities mushrooming across the region, community malls have gained greater prominence.''
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Source: Shalini Seth, Special to Property Weekly