By Sam Bridge
CBRE report says Jeddah's retail sector is benefitting from several new projects, adding 40,000 sq m of gross leasable area
Jeddah’s retail sector is benefitting from several new projects and developments, adding approximately 40,000 sq m of gross leasable area (GLA) to the market, according to CBRE.
CBRE’s H2 2019 Jeddah Market Snapshot said the Saudi city's retail sector expects a further boost with an additional 0.66 million sq m GLA entering the market in 2020-2024, adding to an existing supply of around 1.46 million sq m.
The report added that the F&B sector has also witnessed continued growth, with an influx of international and local brands planning to either establish or expand their presence in the market.
CBRE also noted that despite a marginal slowdown in business activities, key Grade A properties within Jeddah’s office sector have been able to maintain healthy occupancy levels.
The real estate consultancy said it has seen a continued increase in flight to quality, with the better quality accommodation in prime locations seeing the most positive movement, particularly in the case of locations where flexible lease terms are offered.
Simon Townsend, head of Strategic Advisory at CBRE MENAT and general manager, CBRE KSA, said: “The kingdom’s real estate sector remains to be one of key drivers of economic development and one of the key catalysts for continued growth. Despite a slight softening in performance, the sector maintains positive sentiment across the retail, office, residential and hospitality landscape.
"As a consequence, several under construction developments have already secured healthy occupancy levels, having adapted to market demands, whether it be flexibility over sizing, concepts or service offerings.”
The report also highlighted the importance of increased amenities and facilities within residential community developments, with developments now focusing as much on the public realm and social infrastructure as the individual residential offerings.
High-end residential properties located along the coast are expected to experience softening in performance, due to increasing supply in this category, with an additional 1,400 residential units scheduled to enter market by 2023.
CBRE said Jeddah’s hospitality landscape, with an existing 13,900 keys continues to evolve, as the kingdom introduced new tourist visa policies.retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.