(MENAFN- Khaleej Times) The UAE remains a competitive destination for international retailers notwithstanding rising rents that now average annually at $114 per sq ft in Dubai and $71 per sq ft in Abu Dhabi, a study by CBRE revealed.
With Dubai reinforcing its position as the second most important international retail destination globally after London, the UAE remained an attractive destination for retailers, the real estate consulting firm found out in its study.
"In many ways Dubai holds an edge over other established cities as it offers access to significant consumer numbers, high quality mall facilities, and cost sensitive rents even within prime centres, 'said Mat Green, head of Research and Consultancy UAE, CBRE Middle East.
Dubai's relative affordability compared to other global retail markets and the availability of a wide range of brands continue to boost the emirate's appeal as a sought-after retail centre.
In 2012, Dubai was ranked among the world's top five "hot markets" and was the highest ranked target market for new retailers, according to CBRE.
The 13th edition of the Global Retail Development Index (GRDI), compiled by consultants AT Kearney, had four GCC countries ranked among the top 20. The UAE was ranked fifth, followed by Kuwait (9th), Saudi Arabia (16th) and Oman (17th).
"Retailers continue to expand into this region, often using Dubai as their 'launch' platform into other markets such as Doha, Riyadh and Jeddah.
According to CBRE research, 25 new retailers opened stores in Dubai last year. A young population, strong brand association, solid household consumption and modern retail concepts coupled with a flourishing tourism sector continue to provide ideal conditions for retail growth in the country," added Green.
"Abu Dhabi in particular is seeing significant new retail space under development, as it looks to establish itself as a major destination for leisure and shopping. New retail destinations such as the recently opened The Galleria, and the soon to be opened Yas Mall are helping to increase the emirates exposure, bringing with new brands and concepts for the region" concluded Green.
CBRE's quarterly ranking (of the top 10 prime global retail markets saw little change relative to previous quarters; however, four of the top 10 markets €" New York, London, Zurich and Tokyo €" saw quarterly increases in prime retail rents, compared with only one market during the previous quarter.
Historically low construction levels and fierce retailer competition for the best locations is fuelling this growth, leading to record-breaking rents in many global markets. Hong Kong ($4,328 per sq ft per annum) tops the rankings by a substantial margin.
In second position posting prime rents $1,200 per sq ft below Hong Kong, is New York ($3,050 per sq ft per annum). Similarly, a large spread of more than $1,800 per sq ft per annum exists between New York and third-ranked Paris ($1,220 per sq ft per annum).
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