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Wed 12 Oct 2011 11:01 AM

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Dubai Metro on track to lease all retail units by year-end

RTA says may lift ban on eating, drinking on trains to boost retail appeal of stations

Dubai Metro on track to lease all retail units by year-end
The Dubai Metro is offering 195 retail units for lease

Dubai’s transport
authority said Tuesday it is on track to lease all vacant retail outlets across
Dubai Metro’s Green and Red line stations by the year-end.

As many as 195 units
were offered for rent across at stations on both rail lines in October, and the
RTA confirmed it was holding talks with a number of retail firms.

“We have a couple of companies
interested, but a deal hasn’t been signed yet,” said Adnan Al Hammadi, CEO of
Dubai’s Rail Agency. “We expect to have it all rented in a couple of months.
Part of it is already rented.

“[Potential retailers] have to
be sustainable businesses,” he said. “We are also looking for long term
partners, and recognised brands are preferred.”

He declined to specify how many
of the metro’s retail units remained vacant and whether rents had been reduced
in line with current economic realities.

More than 84 million
passengers have used the Dubai Metro since its launch in September 2009,
according to RTA figures.

The launch of the Green
Line, which added a further 18 stations and 23km to the existing rail
network, is expected to drive passenger
figures to 100,000 a day, the RTA said.

The launch of the
metro’s Red Line in 2009 sparked a bidding war among retailers vying to secure
the premium spots. But the difficult economic climate is expected to subdue
demand during the second round of leasing.

Al Hammadi said the RTA may look
to lift an existing ban on eating and drinking on the trains in a bid to
encourage food and beverage sales in the stations and boost their appeal to

“We want to make sure people can
behave properly first, as we want to keep the metro clean and tidy,” he said. “So
we are not doing anything [immediately], but maybe in the future.”

The RTA said in September it
planned to offer a limited number of metro stations up for company sponsorship,
allowing firms to rename the sites.

During the first round of sales, held ahead of the launch of
the Dubai Metro in 2009, 11 station names were sold to Dubai firms such as
Sharaf DG, Etislat, Nakheel and Noor Islamic Bank.

Etisalat’s deal alone reportedly cost AED135m, helping the
RTA to raise nearly AED2bn as it looked to claw back some of the costs of
constructing the metro.

The RTA confirmed in 2009 that the cost of building the
Metro had nearly doubled from AED15bn to AED28bn.

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