1.
MENA Retail Industry Sentiment Survey - 2011 for29th November 2011

2.
Background  What is a sentiment survey: Opinions are important whenever we need to make a decision; we want to hear others’ opinions. Sentiment survey is thus a computational study of opinions, sentiments and emotions expressed in text.  The purpose of this survey was to provide a gauge on the sentiments surrounding the retail industry across Middle East and North Africa over the last couple of years.  To accomplish this objective, in October-November 2011 a sample of MECSC members and non-members were contacted via a structured open-ended questionnaire.  Members: 480  Non-members: 1,862  The resulting sample comprised of about 52 responses from retailers and 110 responses from mall owners/operators/developers.  The findings have been identified and presented as top 3 challenges and attributes in 2007, 2009 and 2011.  The survey was a joint effort of Glasgow Consulting Group (GCG), an independent market research and advisory company, specializing in all major retail categories and Middle East Council of Shopping Centres (MECSC)1

3.
“Top 3” challenges – Retailers Retailers 2007 2009 2011 1. Rents and overheads continue to 1. Declining footfalls 1. Uncertainties in the market and grow low consumer confidence Top 3 2. Overheads continue to increase challenges 2. Non-negotiable lease terms 2. Move towards a more consumer centric operating model 3. Non negotiable lease terms 3. Very low vacancy rates / no space in malls 3. Driving footfalls • Creating sustainable and relevant • Importance of community • Find good locations for expansion developments engagement • Fast changing consumer • Fast changing consumer • Too many look alike centres expectations Other shopping trends within a trade area challenges • Renewal of lease agreement with • Absence of or little focus on • ‘Slower’ or ‘no-growth’ in reduced rents or no increase community concepts population • Slower’ or ‘no-growth’ in • Operating costs • Not enough budgets for population marketing • Footfall • Store location availability • Staff availability2

4.
“Top 3” challenges – Mall Owners / Operators / Developers Mall Owners / Operators / Developers 2007 2009 2011 1. Creating sustainable and relevant 1. Increase footfalls 1. Increased competition / many developments retail real estate developments in the pipeline Top 3 2. Retailers’ tough financial situation challenges 2. Fast changing consumer shopping trends 2. Retaining tenants 3. Leasing rental rates considered high in the market 3. Overheads continue to increase 3. Overheads continue to increase • Architects not designing • Higher vacancy rates • Finding and recruiting talented innovative shopping centres staff • Increased competition • Developers not providing proper • Lack of long term financing for Other parking for retail planned • Retailers’ financial situation developers challenges • Securing line space shop leases • Re-negotiating financing terms • Landlord’s understanding of the with banks current market conditions • Less importance to marketing and promotions budgets • Not enough budgets for • Local municipal policies marketing and promotions • Saying we are still in ‘recession’3

5.
Contact To know more about the survey, please contact: Vishal Pandey Principal Glasgow Consulting Group (GCG) I Research and Advisory P.O. Box 440540, Dubai, UAE Direct: +971 (0) 4 239 3347 I Mobile: +971 (0) 55 974 4360 Email: vp@glasgowconsultinggroup.com Web: www.glasgowconsultinggroup.com4