Doha, Qatar: The retail industry in Qatar is preparing for a potential decline in rental rates in the upcoming quarters of the year, according to a recent report by ValuStrat.
The report highlights the expectation of market corrections, leading to modest decreases in median rental rates, particularly within the organized retail sector, as the year progresses. During the initial quarter of the year, the total stock of organized retail space reached 2.4 million square meters GLA (Gross Leasable Area). This includes the Aventura Mall, which contributed an additional 11,000 square meters GLA in previous quarters. However, the report points out that only one mall is scheduled to open this year, namely La Plage Mall in The Pearl Qatar, boasting 40,000 square meters GLA.
The market has observed significant expansion from both regional and international food and beverage as well as fashion brands, with Abu Sidra Mall welcoming branches from names such as Babyshop, Splash, and Lifestyle. The introduction of West Walk in the Al Waab area has also seen a notable increase in food and beverage outlets, including popular names like Starbucks, Khashoka, Karazi, and SASSO. Additionally, the report indicates that around 25 more shops are set to launch in the coming months. Rawabi Hypermarket recently inaugurated the largest single-floor hypermarket in Izghawa, and Al Meera introduced a new fully autonomous branch in Aspire Park.
ValuStrat points out that during the first quarter of this year, the median monthly rent for shopping centers across the country decreased to QR200 per square meter, signaling a 4.8 percent decline compared to the previous quarter and a 7 percent reduction compared to the same period in 2022.
Qatar's malls, on the other hand, have witnessed increased footfall due to their participation in major leisure activities such as Shop Qatar 2023, as well as various celebrations leading up to Ramadan and Eid 2023.
The report also notes that the median monthly asking rent for street retail within Doha remained stable at QR154 per square meter, showing a 3.8 percent decrease year-on-year. Similarly, the median monthly asking rent for street retail outside Doha municipality stabilized at QR146 per square meter, reflecting a decline of 1.4 percent during the fourth quarter of 2022 and the first quarter of 2023.