Is it Profitable to Invest in UAE Street Retail?

A convenient infrastructure and business promotion policy have turned the UAE into a global hub of international trade. Commercial real estate in Dubai, including one of its most popular types, street retail, attracts the greatest attention of investors and tenants who want to achieve a high level of income.

Content:

• What is street retail?
• How to choose a property for street retail?
• Dubai’s best neighborhoods for street retail investment
• The best types of retail space in Dubai
• Help with buying real estate in the UAE

What is street retail?

Street retail is one of the most common and profitable types of commercial real estate. It is in demand among both small business owners and large corporations. Retail premises of this type are located on the first floor of a building (most often residential) and have a separate entrance.

"Street retail" means "street trade". This term should be interpreted in a broader context rather than its literal term. However, this translates to a continuous flow of customers through a strategic location on a busy street.

How to choose a property for street retail?

The assortment of most standard shopping centers consists of several varieties of goods, so customers could spend several hours there to find the right product. For this reason, such commercial properties can count on a larger flow. Moreover, a key factor in the profitability of street retail is its location.

Before investing or renting commercial property for street retail, it is necessary to analyze the base of potential buyers and have an estimate of the quantity of daily foot traffic. Retail spaces in deserted locations will not be in demand, as the income received from their trade will most likely not cover the investment in buying or renting the premises, staff salaries, and other expenses.

The following locations are considered successful for street retail:

• the first floor of an apartment complex;
• a building next to a busy metro station;
• a central part of the city;
• a building near tourist attractions or office complexes.

Any entrepreneur specializing in street retail seeks to obtain a property in the "trade corridor". A shopping corridor is a group of busy streets with a large flow of locals, office workers, and tourists. In most cases, all the locations in the list above fall under this concept, especially if they are located in popular cities such as Dubai.

However, even a strategic location in the central part of the city or other crowded places is not a 100% guarantee of success. The main factors remain high-quality products, reasonable pricing policy, and the right marketing strategy.

Dubai’s best neighborhoods for street retail investment

Some of Dubai's most profitable places to invest in street trading include:

1. Business Bay. Business Bay claims to be the most sought-after area in the commercial real estate market. Initially, its master plan did not include residential properties. The streets of this cosmopolitan and dynamic location are an ideal example of a shopping corridor. At any time of the day, there are large flocks of tourists coming to see the sights, professionals working in local offices, and locals walking and shopping. The average cost of retail space in Business Bay is AED 2.5 million.
2. Jumeirah Lake Towers. Jumeirah Lake Towers also offers many opportunities for investing in street retail. Since the area is a free economic zone, local commercial properties are in high demand among overseas buyers. The average cost of retail space in Jumeirah Lake Towers is AED 1.82 million.
3. International City. Although International City is a residential area, it has a wide range of commercial real estate. Since there are many apartment complexes here, local shops, showrooms, beauty salons, and catering establishments always have a stable flow of customers. The average cost of retail space in International City is AED 445,000.

The best types of retail space in Dubai

The most popular types of retail spaces in Dubai are:

1. Shops. Commercial locations such as Dubai Marina, Business Bay, and Dubai International Financial Center are the most profitable. The initial cost of this type of retail space is AED 245,000.
2. Showrooms. Showrooms are great for showcasing the latest electronic gadgets, fashion apparel, and other goods. The showrooms located in Ras Al Khor and Al Quoz are the most popular. The initial cost of this type of retail space is AED 125,000.

Help with buying real estate in the UAE

The Emirates.Estate catalog offers you a wide choice of commercial and residential properties, from shops and restaurants to villas and apartments in Dubai and other UAE cities. Go to the aggregator's official website and contact its representatives to get help in choosing a suitable property in the UAE and receive support at all stages of the transaction.