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Riyadh's retail real estate market is a dynamic and evolving landscape, providing a variety of opportunities for smart financiers. Based upon the detailed benchmarking report, here are some crucial dynamics forming this market:
Diversity in Residential Or Commercial Property Sizes: The market showcases a vast array of residential or commercial property sizes, from massive shopping centers like Granada Center Mall with a Gross Leasable Area (GLA) of approximately 100,000 m ², to smaller sized retail centers like Boulevard Mall, boasting a GLA of around 8,000 m TWO. This diversity deals with a broad spectrum of consumer needs and choices.
Geographical Spread: Retail residential or commercial properties in Riyadh are not focused in a single area but are spread across the city. This circulation enables a different investment method, targeting various demographics and socio-economic segments.
Growth Prospects: The retail sector in Riyadh is growing, driven by elements such as increasing population, urbanization, and a shift in consumer costs habits. This growth trajectory suggests a promising future for retail investments in the area.
Quality and Standards: The selected residential or commercial properties for the study are noted for their high standards and quality tenants. This element is crucial as it affects foot traffic, tenant retention, and total residential or commercial property value.
Catchment Areas
Catchment locations are a crucial aspect of retail property, especially for shopping centers, as they directly influence the possible success of these residential or commercial properties. In Riyadh's retail landscape, comprehending these locations is important for financiers.
Here's what the report exposes about catchment locations:
- Definition and Importance: A catchment location is the geographic location from which a mall or retail center draws its consumers. It's significant due to the fact that it affects foot traffic, sales potential, and eventually, the profitability of the retail residential or commercial property.
- Granada Center Mall: This mall sticks out with its catchment area covering a remarkable 40.5% of Riyadh's population. This high portion indicates its substantial impact and reach within the city.
- Al Nakheel Mall: With a catchment area that encompasses 35% of the city's population, Al Nakheel Mall is another key player in Riyadh's retail landscape. Its significant coverage demonstrates its significance as a retail destination.
- Riyadh Park Mall: This shopping center has a catchment that consists of 32.1% of Riyadh's population, marking it as a significant tourist attraction in the city's retail sector.
- Captive Population: Looking deeper into the numbers, Granada Center Mall has the highest share of a captive population, totaling up to 23.8% of Riyadh's overall population. This suggests a strong devoted consumer base that predominantly frequents this shopping mall over others.
Quotation from the Report:
- "The Granada Center Mall covers 40.5% of the population."
- "Al Nakheel Mall covers 35% of the population followed by Riyadh Park Mall with 32.1% coverage."
- "The Granada Center Mall has the greatest share of captive population of Riyadh City with 23.8%.".
Lease Rates and Occupancy Trends
In the Riyadh retail realty market, understanding lease rates and tenancy trends is essential for making educated financial investment choices.
- Granada Center Mall: As of August 2022, this mall, being one of the biggest in Riyadh, reveals an occupancy rate of 64%. It's essential to note that some parts of the mall were under remodelling at the time, which might have affected this figure.
- Riyadh Park Mall: This shopping mall, presently the biggest in regards to Gross Leasable Area, has an excellent tenancy rate of 91.2%, indicating high occupant retention and constant consumer traffic.
- Riyadh Gallery Mall: With a tenancy rate of 93.3%, this mall stands as another essential gamer in the market, reflecting a strong and steady renter base.
- Al Nakheel Mall: This residential or commercial property, essential to the Arabian Center Group, reported a tenancy rate of 82.0%, showcasing its robust standing in the market.
- Lease Rates: While particular figures for lease rates per m two per year aren't offered each shopping center, the report indicates that all the shopping malls included follow a similar prices structure. This harmony suggests a market requirement, which can be a critical element for financiers when examining the possible return on financial investment.
Quotation from the Report:
- "Occupancy (Aug 2022): 91.2%" [Riyadh Park Mall]
- "Currently the 2nd largest mall in Riyadh as per the Gross Leasable Area." [Granada Center Mall]
- "Another large mall in Riyadh. The tenancy is great at 93.3%." [Riyadh Gallery Mall]
- "A crucial residential or commercial property for the Arabian Center Group (Al Hukair Group)." [Al Nakheel Mall]
Investment Opportunities: Case Studies
Case Study 1: Riyadh Park Mall
Riyadh Park Mall stands as a shining example of an effective retail investment in Riyadh's bustling market. Here's a thorough take a look at its attributes, making it a noteworthy case research study:
- Location and Area: Situated on Alamir Mohamed Ibn Saad Ibn Abdelaziz Road, Al Aqeek, Al Shimal, Riyadh Park Mall is tactically located. It boasts an acreage of 139,118 m ², offering ample space for a varied variety of retail and entertainment choices.
- Size and Structure: The mall encompasses a total built-up area of 241,220 m two and a Gross Leasable Area (GLA) of 105,290 m ². This significant size is dispersed across 3 floorings, supplying a huge range of leasing choices.
- Leasable Area Distribution: The leasable area is divided as follows:.
- First Floor: 38,499 m TWO
. -Ground Floor: 63,687 m ²
. -Basement: 3,103 m TWO
. -This circulation permits a diverse mix of retail, dining, and home entertainment outlets. - Tenant Mix and Anchors: Riyadh Park Mall accommodates a substantial variety of anchor shops, even more enhancing its appeal. The variety in its tenant mix deals with a broad spectrum of consumer choices.
- Occupancy Rates: Since August 2022, the mall had a high occupancy rate of 91.2%. This is indicative of its popularity amongst merchants and customers alike, recommending a steady stream of foot traffic and constant income generation.
- Investment Appeal: Given its tactical location, substantial GLA, varied renter mix, and high tenancy rate, Riyadh Park Mall represents a robust financial investment chance. Its success elements work as a guide for what must look for in possible retail residential or commercial property investments in Riyadh.
Quotation from the Report:
- "Address: Parcel No 418, Riyadh Park Mall, Alamir Mohamed Ibn Saad Ibn Abdelaziz Road, Al Aqeek, Al Shimal".
- "Land Area: 139,118 m2".
- "Total Built-up Area: 241,220 m2".
- "Gross Leasable Area: 105,290 m2".
- "Occupancy (Aug 2022): 91.2%".
Case Study 2: Granada Center Mall
Granada Center Mall, a prominent retail location in Riyadh, offers valuable insights into the city's retail property market. Let's explore why it stands as a substantial case research study for potential investors:
- Prime Location: The mall is located in Dammam, Ash Shohda, Ar Rawdah, strategically positioned to bring in a broad client base.
- Extensive Area: Covering a land location of 421,330 m ², Granada Center Mall is one of the largest in Riyadh. It has an overall built-up location of 318,064 m ² and a Gross Leasable Area (GLA) of 102,080 m TWO
. -Leasable Area and Structure: The shopping mall's extensive leasable area is thoughtfully distributed over two floors, improving the shopping experience. The floor-wise distribution is as follows:. - First Floor: 60,027 m ²
. -Ground Floor: 42,052 m TWO
. -Tenant Diversity: The mall hosts a variety of renters, including regional and international brand names, which caters to a broad market, increasing its appeal as a retail location.
- Occupancy Rate: Despite being partially under renovation, the shopping center kept a 64% occupancy rate as of August 2022. This figure is most likely to enhance post-renovation, making it an appealing prospect for future development.
- Investment Potential: Granada Center Mall's size, place, and tenant mix position it as a strong competitor in Riyadh's retail market. Its big GLA and restoration strategies signal capacity for value gratitude, making it an appealing choice for investors.
Quotation from the Report:
- "Address: Granada Center Mall, Dammam, Ash Shohda, Ar Rawdah".
- "Land Area: 421,330 m TWO ".-" Total Built-up Area: 318,064 m TWO ".-" Gross Leasable Area: 102,080 m ² ".-" Occupancy (Aug 2022): 64% (some parts of the shopping center under restoration)".
Case Study 3: Al Nakheel Mall
Al Nakheel Mall, a crucial retail residential or commercial property in Riyadh, emerges as an intriguing case research study for investors. Here's a comprehensive exploration of its functions:
- Strategic Location: Located on Othman Bin Affan Road, Abi Sofian Ibn Harb, Mugharazat, Al Olaya, this shopping center gain from its position in a populated and affluent area of Riyadh.
- Substantial Size and Offering: The shopping center covers a land location of 238,769 m two with a total built-up location of 299,448 m two and a Gross Leasable Area (GLA) of 81,322 m TWO. This extensive size helps with a diverse variety of retail and leisure offerings.
- Leasable Area Distribution Across Floors:. - Second Floor: 20,767 m ²
. -First Floor: 58,463 m TWO
. Ground Floor: 2,091 m TWO- This circulation accommodates different retail and leisure experiences, appealing to a broad consumer base. - Tenant Diversity: Al Nakheel Mall's renter mix consists of a series of regional and global brand names, attracting a diverse group of shoppers and making sure consistent footfall.
- Occupancy and Investment Potential: As of August 2022, the shopping center reported an occupancy rate of 82.0%. This fairly high occupancy rate, combined with its size and area, marks Al Nakheel Mall as an appealing investment chance in the Riyadh retail market.
- Additional Considerations: The shopping center belongs to the Arabian Center Group, contributing to its reliability and appeal. Its large GLA and varied occupant mix position it well within the competitive landscape of Riyadh's retail residential or commercial properties.