Quarterly Report Qatar Q3 2024: Retail Market Overview

Increasing gap in rental levels and occupancy between prime and secondary retail locations

The supply of retail space in Doha’s 31 organized retail malls is approx. 1.6 million sq m, with an additional 0.15 million sq m in malls located in towns such as Al Wakra and Al Khor.

In addition, more than 400,000 sq m of leasable space is available in ‘open-air’ destinations including The Pearl Island, Souq Waqif, Souq Al Wakra, Msheireb Downtown, Katara, Doha Port, and Lusail Boulevard – with much of this space occupied by food and beverage outlets.

No significant new retail developments were launched in Q3. The next major addition to Qatar’s retail real estate supply will be the soon-to-open Doha Mall in Abu Hamour, which was originally expected to launch in September, following the opening of its anchor tenant Lulu in March 2024.

The F&B market in Qatar has become increasingly competitive over the past 5 years. In addition to retail destinations mentioned above, the significant increase in hotels and the emergence of box-parks including Marina Food Arena, District One, and Lusail Night Market, has increased competition in this sector.

The growth in supply of organised retail accommodation and in the F&B subsector, has impacted rents across the market. The concentration of footfall in some developments has seen trading reduce in other locations, leading to an increasing gap in rental values.

The reduced footfall in open-air locations common throughout Q3’s hot summer months has seen an increase in out-door cooling throughout Doha. 21 High Street and West Walk both benefit from the presence of outdoor cooling, which has attracted both customers and tenants alike. It has recently been announced that outdoor cooling will be installed in Souq Waqif, while Crystal Walkway – the retail thoroughfare at Gewan Island – has announced that it will feature the world’s longest climate-controlled retail walkway when in launches in 2025.

High occupancy rates in prime retail locations and underlying demand from retailers for strong trading locations is likely to support rental levels at the top-end of the market; however, a general oversupply and increasing vacancy in secondary locations is expected to see further downward pressure on some rents.

Prime organised mall rents of between QAR 300 and QAR 400 per sq m per month is common for small retail units, with typical line units leasing for QAR 220 – 250 per sq m per month. Malls that have seen footfall reduce following the opening of Doha’s super-regional malls, have largely reduced their rent to below QAR 200 per sq m per month for line units.

Restaurants and cafés in some of Qatar’s most popular outdoor destinations, typically generate rental incomes between QAR 130 and QAR 180 per sq m per month.

Cushman & Wakefield Quarterly Report Qatar Q3 2024

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