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Rivoli warns of Dubai retail casualties amid high rents
by This email address is being protected from spam bots, you need Javascript enabled to view it on Tuesday, 9 June 2009
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Results 1 to 8 of 8
Posted on Thursday, 11 June 2009
Ibn Battuta
Posted by WHATAN at 10:14 UAE time
Every month there are less shops in this place. If they do not start cleaning and maintenance work, it will soon be deserted by most shoppers, you can hardly find a clean toilet there. When are we getting back the parking that was dug up for the circus?
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Posted on Wednesday, 10 June 2009
Rents and Competitiveness
Posted by Dude at 20:12 UAE time
This is a key message for Dubai Government, not to developers to step in and control/regulate the market.
Tourism to Dubai is based around 2 segments: Leisure holiday which based around people coming from cold north to Dubai during fall/winter season for a beach package including many recreational and entertainment sub packages. The second type is mostly regional who comes to Dubai mainly for shopping.
These two segments are highly impacted because:
1. High room rates and other costs of the holiday package.
2. Higher prices for items compared to home country.
In both cases the development plan for the building/facility was not aligned with a long term strategy that take into consideration the impact of development cost on the competitiveness of the development which collectively with other development forms the competitiveness of the sector (being hotels or retail).
To make things worst, pricing strategies to large extent are based around the hit & run mentality. Primarily these strategies are driven by unrealistic return on investment and payback periods targets set by developers/investors. Normally these developments are built to stay for long period and therefore the pricing & financial strategies must carefully align with this fact.
To solution for this requires more than just bringing down the rents. It requires a fundamental change in the mentality of investors, developers towards such investments. The solution requires more flexibility in these organizations to adopt to changing economic factors for the benefits of all and themselves being on top of the list.
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Deira City Centre the only mall for me
Posted by Geriant at 12:16 UAE time
Apart from Deira City Centre and maybe the old part of Burjuman are the only malls in Dubai with any taste of intimacy. Dubai Mall is like a hockey rink, Mall of the Emirates is confusing and without warmth and is too cavernous and Ibn Battuta a monster to park at. Malls are not just for shopping but are micro environments for socialising like old villages were, but the greedy developers don't get it. They should have old-fashioned merchants associations, so the shopkeepers can talk with one voice to management and negotiate from strength. Now all the property promotions have disappeared, there is no proper use of promotional space. Bring a little life to the malls to justify the high rents.
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Myopic outlook harming larger good
Posted by Leo Soz at 11:09 UAE time
The overwhelming enthusiasm (call it greed) of Dubai malls to cash in on the boom time by charging abnormal rents is seriously city's competitive advantage and its well nurtured image of regions's shopping paradise. In order to absorb rents and to foot the ambitious marketing expansio, merchandise has been made more expensive. Not long ago, Dubai was known to be a very competitive shopping location for tourists and transit passengers. Today, many of the business hubs and neighboring countries are able to offer better bargains than Dubai. Then, how long can we expect buyers to flock to Dubai and make a beeline to our malls. The current economic climate alone can not be blamed. I guess the business stake holders (malls, suppliers and regulatory authorities) need to wake up to the evolving business eco-system in the region and put aside individual vested interests. Consumer is surely exercising his better judgement, while the stake holders hope that the storm will blow over with out costing them any loss in revenue.
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Why re-negotiate???
Posted by Joe at 10:23 UAE time
Let's have a dose of honesty here shall we....
The high traffic malls are Mall of the Emirates followed by Deira City Centre (most likely). Why should they lower rents if they are the best in the market? Because shops will close?? Come on, shops in these malls pay the bills for the losing shops in other Dubai Malls. It is not MAF's fault that many retailers agreed to Emaar's crazy rental requirements so why should MAF lower rents to subsidize losses at Dubai Mall or elsewhere??? And if shops close in Mall of the Emirates there is a list of retailers waiting to get in. Let's not forget, Mall of the Emirates is expanding and from what I've heard the extension is already fully leased.
It makes sense that Ibn Battuta and Dubai Mall would lower rents as these malls have low foot fall numbers. But who owns these malls? Nakheel & Emaar. Although it may make sense to lower rents to keep tenants in business these 2 companies are strapped for cash. Unless a tenant "knows somebody" in these companies I doubt Nakheel or Emaar will lower rents.
As for Dubai Festival City, this mall has never lived up to expectations and lowering rent will not change the fact that foot fall is low. And once MAF opens Mirdif City Centre, DFC will see a further drop in foot traffic. The only thing I see DFC has going for it is outside seating for smokers. There are no Al Shaya brands (Starbucks, Mothercare, Next, etc.) so why go there?
And Emaar's Marina Mall....been there once...no reason to go back! I doubt anybody will be profitable in this mall.
Here comes the long, hot, slooooowwww summer...good luck retailers!
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Time to Share in the Pain that Consumers Have!
Posted by Louie Tedesco at 09:46 UAE time
In 2008, we spent nearly 25,000 dirhams on Objets de Art and unnecessary French-branded jewellery baubles at Rivoli and similar shops. We were fortunate, this spend was funded by a reasonable bonus payment which was later followed by a salary increment (very small, compared to other firms increases). And money was still left over - which was also spent.
My company made huge annual profit this year despite the financial mess that we hear about every day. Yet, staff received no bonus, nor a salary increment. The party cake, fully dressed with icing and cherries on top, was turned over to the "shareholder / owners", with not even a crumb given to those who worked hard to earn it.
We consumers can easily live without the small luxuries and we aren't spending a fil this year, in light of the above. Shop owners, however, can’t live without our business. Perhaps someone should give thought to changing the prevailing policies which spread further wealth among the financially elite, but leaves consumers empty handed and the retail outlets vacant?
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Boarded up shops
Posted by Neil at 07:16 UAE time
It appears the effect is already being felt. I've noticed there are a number of stores closing at Festival City - not on the main areas - but if you go along some of the quieter, back areas you can see at least half a dozen shops which have now closed.
I dare say more are to follow in these difficult times.
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Posted on Tuesday, 9 June 2009
Frugal Times Folks
Posted by Ashok Ramakrishnan at 18:49 UAE time
Whether they reduce the rent or not, this global recession that has battered the UAE economy has taught us to respect our hard earned money and to save for our future and our childrens unpredictable future. This aint our land and we are here to work and save and leave not burn our very precious dirhams. Wisen up folks...
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