Dh600m expansion deal to enter the Dragon Mart

The enlarged mall will be equivalent in size to 47 international football pitches. AP Photo

Nakheel has appointed contractors on the Dh600 million (US$163.3m) expansion of Dragon Mart in Dubai.

The move comes as the Palm Island builder switches focus from residential to retail.

The developer yesterday said it was awarding contracts to double the size of the sprawling mall famous for its huge range.

But navigating the vast development may prove a challenge for shoppers with the enlarged mall equivalent in size to 47 international football pitches.

"Dragon Mart is already the world's biggest trading hub for Chinese products outside mainland China. The phase two expansion will provide many more opportunities for retailers, hoteliers and restaurants to prosper," said Ali Rashid Lootah, the chairman of Nakheel.

The 177,000 square metre extension of the mall will include a Geant hypermarket, a nine-screen Grand Cinema complex and a three-storey hotel. The project is being delivered on a build-operate-transfer basis, a form of privately financed construction. It is being built by a vehicle called New Mall Limited, said Nakheel. A spokeswoman declined to provide further details. Building contracts are shared by United Engineering Construction and Kele Contracting.

Despite the construction of millions of square metres in new retail space across the Emirates over the past decade, the sector is still benefiting from strong retailer demand.

Deerfields Town Square, an 80,000 sq metre mall under construction in Abu Dhabi, has already leased half of its available retail space, six months before its expected completion, Jones Lang LaSalle reported last month. Nakheel has also appointed architects to design a 160,000 sq metre mall on the Palm planned to open in 2014.

Developers with malls within their portfolios have reaped the rewards of rising visitor numbers in the Emirates this year.

Emaar Properties, the developer of the Burj Khalifa, reported a 28 per cent increase in leasing revenues in the first quarter compared with a year earlier - most of which came from the retail sector. Nakheel said yesterday it had pre-let 80 per cent of the available space in the extended Dragon Mart.

About 52,000 people visit the mall every day, generating annual footfall of about 18.9 million.