Retail spending estimated to increase over QR57bn in 2023

Retail spending estimated to increase over QR57bn in 2023 By A Robin - November 27, 2023
Souq Waqif

Souq Waqif

The retail market spending in Qatar is expected to exceed QR57 billion in 2023, driven by a surge in tourist numbers, economic growth, and the presence of globally renowned retail outlets in the country. Cushman & Wakefield's research reveals that there is more than 1.7 million sq m of leasable floor space in the main organized retail malls, excluding supermarket buildings with ancillary units.

The report highlights over 400,000 sq m of leasable space in 'outdoor' retail and F&B destinations, including The Pearl, Souq Waqif, Souq Al Wakra, Msheireb Downtown, Katara, Doha Port, and Lusail Boulevard. Despite a notable growth in supply over the past eight years, the retail real estate market has experienced falling rents in most sectors due to increased competition, leading to an improved retail offering for shoppers.

The occupancy rate across Qatar's retail malls is estimated to have fallen to approximately 80 percent, with developers offering rent-free incentives, fit-out contributions, and turnover rent arrangements to attract retailers. Demand for retail space has declined in 2023, as many retailers seek to consolidate after expanding their operations in Doha in recent years.

Oxford Economics reports that total nominal retail sales in Qatar reached close to QR53.6 billion last year, the highest in the last five years, despite the impact of COVID-19. Qatar's high disposable income levels, among the world's highest, reflect $97,096 in December 2022 when adjusted by purchasing power parity.

Headline rents for line units in Doha's prime malls range between QR200 and QR250 per sq m per month, excluding service charges. Secondary malls typically offer lower rents, while anchor units and entertainment provisions benefit from rents between QR60 and QR150 per sq m per month. Retail showrooms are available for lease at QR80 to QR150 per sq m per month, while small convenience retail outlets in secondary locations lease for QR5,000 to QR10,000 per month, depending on unit size.

By A Robin - November 27, 2023

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