BOOST FOR BAHRAIN RETAIL
Stable consumer demand and the development of new residential communities along with tourist flow are driving the Bahraini retail market growth.
Recognised by the World Bank as a high-income economy, Bahrain has seen stable development of its real estate market over recent years with the domination of the retail sector that witnessed several significant openings and new development announcements in 2015.
“The provision of neighbourhood shopping centres and food and beverage solutions has emerged as a major trend that presently shows no sign of abating,” commented Heather Longden, Associate Director at CBRE Bahrain WLL. “Despite Bahrain being a small country in size and population, the community retail developments currently in operation appear to be answering a need and investment in this sector continues to grow.”
“Opportunities for retail are growing as residential developments are in the pipeline and community retail to support these communities become more popular,” added Andrew Williamson, Head of Retail at JLL MENA. He also noted that a key contributor to the strong performance of the retail market was the high level of Saudi Arabian tourist traffic flowing into Bahrain over the weekends, as well as a number of new retail brands showing interest in entering the market.
While Bahrain’s retail market used to be concentrated in the country’s capital, the deviation from the established mindset of retail being purely Manama oriented has firmly taken hold and opened up opportunities for developers and investors, as per CBRE.
“Developments range from smaller complexes, anchored by supermarkets, which also offer retail space for services and convenience stores, to larger developments that provide a fully comprehensive mall experience to customers, such as Seef Mall Muharraq, which also houses an international cinema brand,” said Heather Longden of CBRE.
One of the new retail projects, Dragon City at Diyar Al Muharraq, was opened at the end of December 2015. It is a unique retail destination featuring Chinese goods and establishments with a total of 780 shop units spread over 55,000 square metres. Elsewhere in the retail sector, significant openings scheduled for Q1 2016 include Galleria in Zinj, a Dadabai project offering over 42,000 square metres of GLA, closely followed by the USD 40 million Wadi Al Sail mall in Riffa anchored by Geant.
“Community malls serving new residential districts currently reign as the dominant theme and nowhere is this more evident than in New Janabiya, where no less than four separate malls are under development or planned. The 5,000 square metres Al Mercado, anchored by Al Osra supermarket, is well under way and three other retail projects totalling nearly 50,000 square metres of leasable space are being considered,” added Longden.
JLL believe that Bahrain will keep working towards an increased international retail offering and having diverse retail formats, such as community and neighbourhood retail malls like The Courtyard, Galleria, Wadi Al Sail Mall, and waterside retail such as The Lagoon, etc.
CBRE predict further diversification for Bahrain’s retail sector, with a consistent stream of announcements from the government related to large-scale social and affordable housing schemes, requiring retail and food and beverage offerings for residents.
“A competitive market and challenging economic circumstances have also contributed to an increase in mixed-use developments, for example, commercial office towers and residential properties that offer onsite services to users, adding to the supply of retail stock in the Kingdom,” added Heather Longden from CBRE.
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