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Saudi retail leasable area to grow 11.3pc

Riyadh, April 18, 2010

The supply of mall-based retail gross leasable area (GLA) in Saudi Arabia is expected to expand at a compound annual growth rate (CAGR) of 11.3 per cent to reach 8.3 million sqm by 2012, according to a recent report.

Jiwar Real Estate Management & Marketing, a leading real estate company in the region and the marketing arm of the Saudi Bin Laden Group, said in its report, that the Saudi market is expected to produce an additional 1.5 million sqm of retail GLA within the next two years.

“The outlook for the kingdom’s metropolitan mall-based retail market is excellent given the strong growth in demand and increasing occupancy rates. The government’s strategic focus on expanding the non-oil economy is likely to lead to the development of additional commercial industries, of which mall retailing will be a major beneficiary,” said Dr Saleh Bin Abdullah Al Habib, CEO, Jiwar Real Estate Management & Marketing.

Saudi's level of personal disposable income is anticipated to grow at a CAGR of 6.5 per cent to reach around SR659 billion by 2013. GDP per capita is also expected to rise at a CAGR of 7.3 per cent to SR78,723 by 2014. Both the personal disposable income and GDP per capita are expected to grow faster than inflation.
Another factor contributing to the momentum of the Saudi retail market is the youthful composition of the Saudi population, with 63 per cent of citizens under the age of 30. The population growth in the kingdom stands at 2.49 per cent as compared to the global average of 1.14 per cent.

More than 12 million people visit Saudi Arabia annually, thus making retail tourism a key driver in the kingdom’s mall-based expansion, the report said.-TradeArabia News Service

Tags: Saudi Arabia | mall | commercial | Jiwar Real Estate Management | retail rental |

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