Departing CEO says mall operator plans to double its portfolio over the next seven years
Dubai’s Majid Al Futtaim (MAF) Properties, the operator of malls and hotels in the Middle East, will look to expand its geographical reach in Egypt and Saudi Arabia, its CEO has told Arabian Business.
The mall operator, which also owns regional franchise rights for the French hypermarket chain Carrefour in 19 countries, said retail sales in its Dubai malls had increased 10-15 percent as the emirate continues to benefit from its safe haven status amid regional political turmoil.
“We’re always expanding; we aim to double our portfolio over the next five to seven years [through] new developments,” said Peter Walichnowski.
“We have more malls in Egypt coming, which is a strategic market for us. We are looking at Saudi Arabia, the first tier and then the second tier cities. Saudi Arabia is probably the best at the moment for future expansion,” he added.
Walichnowski, who gave MAF a six-month notice period for his resignation on 1 October, said the operator plans to build a 2m sq ft shopping mall in Riyadh, which is likely to take up to five years to develop.
The operator may also look at smaller community-based shopping malls in Abu Dhabi and Dubai, he added. “In terms of GCC some markets are nearing saturation, there’s not much in Dubai or Abu Dhabi really but maybe some smaller neighbourhood community centres that can be done.”
Retail sales at six UAE-based malls, which include Mall of the Emirates and Deira City Centre, have increased 10-15 percent so far this year while sales in Egypt and Bahrain are starting to show some signs of a recovery following a dip amid the Arab Spring.
“During 2012 we will see sales increase of 10-15 percent, which is very healthy relative to the inflation rate which is around 3 percent. It’s a combination of the impact of the Arab Spring and the general health of the economy,” he said.
Sales in Bahrain and Egypt, which were hit hard by the Arab Spring last year, have increased 15-20 percent year-on-year, he added.
“I would say if we dropped 15-20 percent last year, we are picking up 15-20 percent this year so by the end of this year I would forecast that we will be back where we were before the fall out.”