Survival during and after Covid-19
Dubai, UAE, 15 April 2020 – Colliers International, The Global Commercial Real Estate Leader, released its latest white paper on the impact of COVID-19 outbreak on MENA’s retail and development sector, exploring how retailers and developers can adapt to ensure resilience in a period of great uncertainty.
Whether voluntarily or due to government mandated lock downs, hundreds of thousands of physical stores across the planet remain closed, drastically impacting not only brick-and-mortar sales but also reducing retailer’s ability to service online orders in store. As the virus’ impact manifests across all sectors of the economy, consumer confidence is likely to be dampened, further impacting sales and increasing the likelihood that the impacts on comparison retail will be felt for months to come.
In addition to luxury comparison retail and full-service restaurants, entertainment and leisure are proving to be some of the hardest hit retail categories, with cinemas worldwide closures at an unprecedented rate, both voluntarily and due to government restrictions. While full-service restaurants have some ability to adapt, e.g. experiment with takeout / delivery options, dedicated entertainment & leisure facilities remain closed indefinitely due to their social nature.
Ricardo Bergsma, Director of Leasing and Retail Advisory Services at Colliers International MENA:
“Shopping centers continue to close as governments implement varying degrees of lockdowns in a bid to thwart transmission of the virus. Countries with nationwide mall closures include the UAE, Saudi Arabia, Kuwait and Egypt, dramatically impacting retailer operations which will have widespread implications, particularly for mall owners / operators who are likely to see major disruptions in lease payments. For Shopping mall owners to try and mitigate the impact, certain measures should be taken into consideration such as increasing PR activity with press releases, adopting screening measures in the malls, considering short-term rent break and increasing social media presence.”
He adds: “Grocery retail on the other hand is struggling to keep up with the demand, now that consumers rely on supermarkets and grocery shops to buy their goods. Carrefour in the UAE has revealed a 300% surge in online orders & 59% increase in new customers onto its platform”
Ricardo concludes: “Overall, we are seeing retail as one of the fastest sectors to recover when the market bounces back to normality. We are working with retailers on case-by-case bases to provide customised advice and guidance.”