Qatar real estate market sees rise in supply of outdoor retail space

The supply of outdoor retail and F&B accommodation has been increasing in Qatar. Destinations such as Medina Centrale and La Croisette in The Pearl Qatar, Katara Cultural Village, and Souq Waqif now generate strong weekend footfall.

Leading real estate advisor DTZ Qatar said in its latest market report that the success of these developments has been supplemented by ‘pop-up’ F&B venues such as those at Qatar Sports Club, Duhail Sports Club, and Katara.

The increasing popularity of outdoor F&B/leisure destinations has resulted in development proposals for a number of new projects in Lusail and Doha, as well as the expansion of Katara Cultural Village’s retail and F&B offering, which is expected to open soon.

To date, there is now almost 1.4 million sqm of retail accommodation in 21 purpose-built malls across Qatar. This reflects a 120 percent increase in just four years, and is due largely to the opening of Qatar’s two largest ‘super-regional’ shopping centres, Mall of Qatar and Doha Festival City.

The most recent addition to the retail landscape in Qatar is the mall at Katara Plaza, which is anchored by the luxury department store Galeries Lafayette. Four additional major destinations are also expected to open their doors in the next 12 months, including Doha Mall, Doha Souq, La Galleria at Msheireb, and Northgate Mall.

As the retail market evolves, new developments have been increasingly concentrating on the family leisure and entertainment components. Prime retail rents are still in the region of QR250-QR300 per sqm per month.

On the hospitality market, luxury accommodation still dominates the market with more than 90 percent of overall supply currently categorised as either 4-star or 5-star. According to the National Tourism Council’s (NTC) estimates, approximately 23,000 hotel keys at various stages of planning and construction are to be completed prior to the 2022 Fifa World Cup.

Occupancy rates in hotels have increased over the first half of the year compared to the corresponding period in 2018. Data from the Planning and Statistics Authority (PSA) show that the overall occupancy rate in May 2019 was 66 percent, which is 6 percent higher than the 2017’s figure. Occupancy rates are being boosted by domestic tourism as residents take advantage of hotels’ lower prices and special offers, in addition to demands from business traveler in the region.

DTZ also said that despite the recovery in occupancy rates, hotel revenues have continued to decline overall, reflecting increasing competition between hotels. The overall Average Daily Rate (ADR) dropped by 6 percent for the first quarter of 2019 compared to the same period last year. The decline continued in April and May as overall ADR’s fell to QR373 according to the PSA.

The NTC has continued to introduce measures to boost tourist numbers, following the introduction of visa-free travel for 80 countries. The ‘Summer in Qatar’ initiative taking place between Eid al-Fitr and Eid al-Adha, has been underway and aims to increase hotel occupancy and retail spending, in what is traditionally the quietest time of the year, DTZ Qatar noted

Source from: The Peninsula Qatar