Lifting festival spirits

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EVANS: In retail, if you don’t reinvent yourself you die pretty quickly.

Al-Futtaim Group Estate's director of retail leasing Philip Evans talks about his strategy to create the best cluster of tenants at its projects.

Philip M Evans, the director of retail leasing at Al-Futtaim Group Real Estate has a swift response when asked about his strategy for Dubai's Festival City: to deliver one of the best shopping centres in the world.

"We don't want to be the biggest or the tallest, but we want to provide the best cluster of retailing in this environment."

During his 25 years in leasing and asset management, Evans has set up new retail projects in a plethora of markets including Syria, Jordan, Greece, Turkey, Cyprus, Romania and Bulgaria, leading the leasing team for Greece's first regional shopping centre The Mall of Athens.

Spanning 1300 acres and stretching 3km along Dubai Creek with 3.3 million² GLA, Dubai Festival City encompasses accessible shopping, dining, entertainment, residential communities, schools, hotels, offices and leisure.

Evans explains that as part of his clustering strategy, the existing shopping centre will be dedicated to Everyday Retailing, the adjacent area will cover Aspirational Retailing, in addition to the upcoming 650,000 ft² Festival Centre Luxury Collection extension, claimed to be "the largest collection of luxury retailers in Dubai, giving retailers the opportunity to showcase their entire merchandise, not just shoes and handbags, in much bigger units."

"No matter what socio-economic profile our customer has, there is something for everybody. They can come to the centre if they just want to do their everyday fashion retailing," he comments.

"They know where to find it and they don't have to walk 400km in a huge shopping centre to find a comparison shop for a particular thing they're looking for. Everything will be under one roof. Our [Dubai Festival City] customer base is 40% Emiratis, 30% Asians and 30% white expats; the balance doesn't get better than that."

To stand apart from rival shopping centres in an increasingly crowded market, "we want to keep bringing in new international and niche retailers so the balance is right."

"People won't come in and see the same shops as elsewhere. We want to have a good collection of new retailers and give people a good reason to come here."

Evans points to the common error made by other centres in Dubai, which have carried out various extensions to the neglect of their existing tenant mixes in the core centres.

"You live and die by that, and we will make sure to keep revisiting the core centre and refreshing the tenants, as not all of them will perform to their expectations or indeed ours.

"It's a question of identifying those through proactive asset management and doing tenant engineering all the time to make they [the tenants] and the centre are trading to their optimum."

Dubai Festival City will open its Gold Market Souk this month, a cluster of 45 units let virtually entirely to Emirati gold retailers and designed by the woman behind the look of the Jewellery Hall at Harrods to truly differentiate it from similar concepts in the city.

"We have spent a significant sum of money investing in the quality of design and the execution of it and it really will be a world-class environment," he promises.

The centre will also unveil its trade souks in the latter part of this year, which will bring in "a lot of local retailers and allow them to trade in an environment that they are comfortable with", with goods including carpets, perfumes, teas, coffees and musical instruments.

Evans stresses that accessibility to Dubai Festival City will prove a crucial pull factor in the future, despite the opening of new malls.

In conjunction with Dubai Municipality and numerous traffic management consultants, the project has built a traffic plan that will accommodate all stages of increased traffic in the emirate, incorporating wide and spacious internal road systems designed for ease for access and minimal traffic congestion.

"One of the challenges that a large shopping centre opening in Dubai later this year faces is the infrastructure around it. If you don't get that right, customers are frustrated," he remarks.

To flaunt Egypt's first indoor-outdoor retail and entertainment complex, Cairo Festival City - a 1.8 million m² GLA development project - will again focus on anchor tenants, according to Evans.

"In Cairo, we have signed the cinema operator and we are negotiating terms with the hypermarket operators and our own Al-Futtaim brands - IKEA, Marks & Spencer, Toys R Us and Intersport; 40% of GLA is leased to anchor tenants, then we will launch the rest of the scheme in early 2009," Evans reveals.

The group must follow a well thought-out strategy in its approach, for example Cairo Festival City will feature a bigger space devoted entirely to Everyday Retailing.

"We are in no rush to let Cairo as we are working in a very inflationary market and we have to be very careful how we pitch it in terms of rents. With big construction costs and high inflation built into that, we have to make sure we deliver a certain return at the end of the day," he says.

Because there are fewer retail groups in this region controlling a larger number of brands in the region, Evans says, "you could say it's easier because there are probably about 12-15 companies that control about 80% of the market. However we don't want to lease our product to people who are already here in the market."

Trawling the world for new and exciting retail offers, Evans has recognise a gap in the regional market for quality department stores, however he says the economic downturn in some markets has meant that although "the Middle East is the most stable financial market for the next two years, the rest of the world is suffering like hell. International retailers are focusing so much on their core markets and trying to maximise their own available spend, it's difficult to get them to focus their intensions on expansion over here."

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