Qatar emerges as Mena’s latest retail destination; 880,000sq m new space contributes to Doha's attractiveness: Knight Frank

Qatar is fast emerging as the Middle East and North Africa’s (Mena) retail destination, cashing in on the mammoth infrastructure built up in the run up to 2022 FIFA World Cup, as the 880,000sq m of new retail area built has further contributed to Qatar’s tourism attractiveness, according to Knight Frank, a London-based global real estate advisory firm.

Moves by the government to capitalise on the $330bn infrastructure spend in the 10 years leading to the 2022 FIFA World Cup are paying dividends, Knight Frank said in a report, citing the increased inflow of tourists.

"Qatari authorities have channelled their efforts into transforming Qatar into a modern state, complete with a plethora of and growing number of tourist attractions, including the recently announced $ 5.5bn Simaisma Project," said Faisal Durrani, Partner – Head of Research, Middle East and North Africa, Knight Frank.

Aside from the incredible tourist attractions that are emerging around the country, the luxury retail sector is fast emerging as a key magnet to prospective visitors, he said.

It has found that the not only is the sector the second most popular investment asset class for GCC (Gulf Co-operation Council) nationals and GCC-based expats, but 79% of regional visitors are keen to visit the country purely to go shopping.

"This suggests that the 880,000sq m of new retail built in Qatar since 2011 has not gone unnoticed and is further contributing to Qatar’s attractiveness as one of the world’s most exciting new tourist destinations,” he said.

Knight Frank’s research reveals that for the GCC nationals aged 18-45, the retail sector was the second most popular investment asset class, behind branded residences. For Saudis and Emiratis, the retail sector is also the second most popular asset class in Qatar at 40% and 36%, respectively, behind branded residences.

The sector is held in even higher regard for GCC-based expats, with 44% of Saudi-based expats and 34% of UAE-based expats naming it as their target asset class, hinting at the authorities' success in fostering a vibrant and attractive retail landscape.

Overall, nationals and expat residents in Bahrain and Saudi Arabia have the strongest desire to travel to Qatar for shopping at 85% each. The UAE (76%) and Kuwait (75%) show moderate interest. In comparison, Oman exhibits a lower interest rate of 63%.

The appeal of Qatar to those living in Bahrain and Saudi Arabia as a place for a shopping holiday likely stems from their relative proximity and cultural similarities, it said, adding strong historical and economic ties are also likely factors, according to Knight Frank. Saudi Arabia emerged as the top source market for tourists in 2023, while Bahrain ranked seventh, ahead of the UAE (ninth place).

This interest in travelling to Qatar to shop is particularly strong among the higher income brackets, irrespective of country of residence or origin, it said, highlighting that 88% of those earning QR22,500-25,000 per month and 86% of those earning above QR25,000 per month showed interest in Qatar for a shopping holiday.

Highlighting that Qatar's strategic location, world-class retail offerings, and unique shopping experiences make it a premier destination for the GCC visitors; Jonathan Pagett, Partner – Retail Advisory, Middle East and North Africa, Knight Frank, said its survey reveals a robust interest across various demographics, particularly among younger adults and those in higher income brackets, indicating strong market potential.

"The appeal of Qatar's luxury brands, modern malls, and cultural affinity with neighbouring countries like Saudi Arabia and Bahrain further enhance its attractiveness. By continuously improving the retail experience and hosting major events like Shop Qatar, Qatar is well on its way to emerging as the region's latest retail destination," he added.

Finding that the appeal of luxury and international brands is "especially strong", with cultural activities and local products adding to the shopping experience; he said this could serve as a model for mall operators and developers seeking to take advantage of the increasing interest from the region in traveling to Qatar for a shopping holiday.