Over the next five years Dubai is forecast to report the strongest growth in retail sales among the seven global cities examined by a study.
According to the latest Global Retail Destination Index 2016 from Savills, 88.4 per cent of people in a survey said Dubai has the best choice and quality of shops in the world. "Dubai Mall ranks higher than London's Regent Street, New York's Fifth Avenue and the Champs-Elysees in Paris in terms of the overall quality of its retail facilities and amenities."
"Dubai, is forecast to report the strongest growth in retail sales over the next five years of the seven Global Cities examined, potentially challenging London's West End's current global position," said the report made in partnership with The Retail Group.
The latest analysis by the Dubai Chamber of Commerce and Industry based on data from Euromonitor International underscores the emirate's growing clout as the fastest growing retail hotspot. Dubai's retail market is forecast to surpass $52 billion in sales by 2020 with average annual growth of more than eight per cent, according to a new report.
The report by Savills measures the various retail attributes held by London's West End and compares them to six other leading cities: Dubai, New York, Paris, Milan, Hong Kong and Singapore.
The Dubai Mall locations were based on their brand positioning in comparison to the key retail destinations in the West End. As a result, each strip of the mall - Star/Grand Atrium strip, Fashion Catwalk and Fashion Avenue - was treated like a 'street'.
The top ranking Global Retail City from the analysis is New York. London's West End ranked second alongside Hong Kong, followed by Dubai.
According to the Mastercard Global Destination Cities Index 2015, there were 14.3 million overnight visitors to Dubai last year, which commanded a total spend of $11.7 billion, an average of $819 spent per visitor. This was some way behind New York's average spend of $1,416. However, the number of overnight visitors to Dubai, between 2016-2020, is expected to increase by 9.7 per cent.
The Savills report pointed out that Dubai Mall was the least expensive in terms of indicative prime total occupational costs as of fourth quarter 2015 - prime rent per sqft $240; additional occupational costs per sqft $60; total occupational costs per sqft $300. This compared to the total occupational costs per sqft in New York's Fifth Avenue - $3,900.
While in the shopper experience, which was assessed via the location surveys focusing on those responses related to ease of shopping, connectivity, service levels and directional signage, Dubai outperformed London, Paris, Singapore and Milan.
David Godchaux of Core Real Estate, a Savills associate, said Dubai is perceived as a top global retail destination. "But this is only the tip of the iceberg as we now start seeing developers trying to improve the shopping experience not only for tourists as in the past 15 years, but also for residents. This trend of moving away from the 'bigger is better' approach, to more user and resident friendly retail developments, bringing a real city experience and European-style shopping to areas of Dubai similar to those found in London, Paris and Milan, is something that was much awaited by the market and that we see finally happening."
Dubai's retail sales reached $35.4 billion in 2015 and are set to see a 7.7 per cent expansion in 2016, Dubai Chamber said in a report.
The analysis said that store-based retailing was behind 98 per cent of the total value of retailing in 2015, and its pace of growth has by large margin outpaced growth of the non-store retailing category since 2010.
Hamad Buamim, President and CEO, Dubai Chamber, said growing economic prosperity, steady population growth, and rising incomes have all helped to increase consumers' overall expenditure in Dubai. In addition, the boom in tourist numbers have kept the wholesale and retail sector vibrant, said.