Final cost of extension is in excess of $1 billion, Kevin Ryan, the chief operating officer of Gulf Related
The extension to ‘The Galleria’ in Abu Dhabi’s designated financial zone officially opened on Wednesday, with the target of capturing a new market share in the capital’s retail space at a final cost exceeding $1 billion.
Speaking to Zawya at the opening ceremony of the mall’s new extension on Wednesday, Kevin Ryan, the chief operating officer (COO) of Gulf Related, said that he expects no oversupply in the emirate’s retail industry despite the anticipation of a major new mall opening next year on Reem Island, which is close to The Galleria.
“I don’t see that there will be an oversupply. I think that what usually happens in markets as they mature is that you start to see segmentation, where some become diamond centers, others become secondary or tertiary, and it affects how the merchandise mixes over time,” he said. “So it is fairly common to see a lot of retail centers open … the market is pretty large.”
He also noted that there is a market share in Abu Dhabi that is Dubai-related. “A lot of people who live here in Abu Dhabi still go to Dubai to shop, even with the retail centers that already exist here. But we think that the expanded Galleria creates a reason to stay in Abu Dhabi and not have to travel to Dubai, and we’ll definitely capture this market share that we have been linking to Dubai as well.”
In addition, Ryan believes that mid-income consumers in Abu Dhabi would be catered to at the new opening. “We have very broad offerings from a value oriented retail centers …We have a lot of casual food openings, a food court, and a food hall called ‘Central Kitchens’, so the offerings are quite extensive …We have something for everybody, from dining to shopping to entertainment.”
He also noted that there are a number of first-to-Abu-Dhabi offerings such as Decathlon and Missguided and new family entertainment offerings such as Xtreme Zone and a 21-screen VOX Cinema. The objective is to cater to Abu Dhabi residents in accessible locations “adjacent to the center of Abu Dhabi Island, adjacent to Reem Island, and to Saadiyat.”
The Galleria Al Maryah Island, which originally opened in 2013, was developed by Gulf Related, a joint venture between the UAE’s Gulf Capital and United States’ Related Companies.
Over 80 per cent of the expansion is leased, with nearly all stores set to be open by end of 2019. The extension houses over 250 new international brands and 70 dining venues, including favorite family food offerings such as The Cheesecake Factory, PF Chang’s and Paul Café. With the expansion, the Galleria Al Maryah Island mall now has more than 400 stores, and 100 food and beverage options.
On the decision to develop an extension after building the original mall, Ryan said, “When we formed Gulf Related in 2009, we were looking at opportunities, and Mubadala was building this mixed-use complex, which includes office buildings and two hotels. So we saw an opportunity to build a luxury and dining-focused project, and that was our original idea. But because we had a lot of success with that project among tenants, we got into discussions about growing a larger offering and making retail and shopping a more significant focal point on Al Maryah Island. So it was not an intentional plan to go from a smaller to a larger component; it was more an outgrowth of the success of The Galleria, and we saw an opportunity, particularly with Al Maryah Island being the new downtown and business district.”
Al Maryah Island is designated as Abu Dhabi’s International Finance Center and is an international financial free zone. The 114-hectare area is also home to Abu Dhabi Global Market.