DIFC reviews retail strategy amid closures

EXCLUSIVE: Kuwaiti retailer closes four top-end designer stores in financial centre.

DIFC PLAN: New retailers are set to fill the vacant units in DIFC's Gate Village which will better suit the area. (Getty Images)

DIFC PLAN: New retailers are set to fill the vacant units in DIFC's Gate Village which will better suit the area. (Getty Images)

Dubai International Financial Centre (DIFC) said on Monday it is revising its retail strategy following the closures of four top-end designer stores.

Boutiques of designers Vivienne Westwood, Jill Sander, Issey Miyake and Nina Ricci, which opened just over a year ago in conjunction with Kuwaiti retailer Villa Moda, have closed their doors in Gate Village for good.

In a statement, DIFC said new retailers are set to fill the vacant units in due course that would better suit the financial area.

“DIFC is revising its retail strategy to bring the retail offer of the shops and stores in the financial centre into line with the needs of the DIFC community and the surrounding district.

“As part of this process, some of the retail outlets in the DIFC have closed temporarily to be replaced in the coming months by companies in the pipeline of retailers, who have already expressed interest in taking space in the financial centre.”

Both the Vivienne Westwood and Nina Ricci boutiques were the first for the fashion designers to open in the Middle East region.

A Villa Moda spokesman said on Monday that a combination of low footfall and brand awareness had contributed to the store closures.

“Gate Village, while it is very beautiful, it is quite quiet, and may not be the best location for brands that are not that well known,” he said.

“The brand awareness also hasn’t responded as well as we expected. The sales haven’t done what they would do in Europe among Dubai customers. So we thought it better to stop now and revise our business plan.”

He added that the brands would have stood a better chance of building up a client base in Mall of the Emirates where footfall is much stronger.

He said Villa Moda was a recognisable brand in Dubai and there were no plans to close the men’s and women’s boutiques also in Gate Village.

He said the company was looking at its future options, which would include new brand openings, but he declined to elaborate further.

Villa Moda was founded by the nephew of the Emir of Kuwait, Sheikh Majed Al-Sabah. The company opened its first store in Kuwait in 1992, and has shops in Dubai, Qatar and Damascus.

The company stocks 11 different luxury fashion brands including Gucci, Yves Saint-Laurent, Bottega Veneta, Prada, Dolce & Gabann and Salvatore Ferragamo.

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Posted by: Abi

The reason why normal down to earth retailers shy away from DIFC is because of the high rents, how do you expect supermarket operators to pay 300 dhs per sq ft upwards for space at DIFC when they work on a 15 to 17 % margin. The would be working only to pay rents at DIFC. DIFC retail should be a service orientated facility for DIFC offices and not a money making component. IF the management drops rents to reasonable levels or take a percentage of sales/turnover as rent, they will attract a sensible mix of retailers to the pleasure of the tenants!

Posted by: Bassam

I think the one major problem why shops close down in this place are Brutal price tags. I have only laughed when entering any of these shops. And if you go back to the root of the problem, its because DIFC charges an extremly high rent for all of those keeping no way to negotiate, thanks for DIFC management. The place could get deserted soon with only Subway and Scuzi left. (Even Scuzi are getting greedy and silently raising 10% every while) Additionally, I personally dont think anybody can go shopping for clothes in the burning sun!! No body thought of this guys?? ACTION PLAN FOR DIFC SMART MANAGEMENT: Get financial institutions to fill up the free shops: like Local Banks and Local Brokers. You will find many who would love to cater for a high end community. And a shop this way gives the place a better feeling. Now thats what I call smart. And oh btw: Dont rip them off.

Posted by: Andrew

The retailers who entered DIFC's Gate Village were doomed from the start. Just walking by you could see there was no chance for them. We need to meet some basic needs. I want to do some light shopping before I go home - grocery store please. The Du shop closed - many of the DIFC's population live in Du only areas. Instead we get enough art sellers to start a small (high cost per square foot) colony. C'mon.

Posted by: alex

The DIFC is totally unrealistic and doesn't know its market. It is full of aspirational shops but the DIFC is full of lawyers, bankers and accountants; all well paid but hardly the type of people who are going to buy Vivienne Westwood! What the place needs is shops to match its tenants: a proper sandwich shop, a video shop, clintons cards, a florist, maybe a burger king (well maybe not ...). And I bet that a disproportionate number of people live in "New Dubai" but the du shop closed down, apparently because the rent was so ludicrous.

Posted by: Bud

DIFC is managed by Dubai Properties retail, the same people who run JBR. The same mistakes in both places. This means that their strategy was wrong and they have no clue on what is needed. This is again about having the right people running the business.

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