Dubai Gold Souq to shine once more

Renovations are finally set to begin on Dubai Mall's gold souq - with video.
Some jewellers say they have been given generous terms on new stores in the refurbished souq at Dubai Mall.
Some jewellers say they have been given generous terms on new stores in the refurbished souq at Dubai Mall.

Dubai Mall's Gold Souq is finally set to be renovated after two years of intense wrangling between Emaar Properties and retailers about the lack of visitors.

Jewellers have been issued with eviction notices and told to clear their shops before September 3, when work is expected to begin on transforming the souq.

Many jewellers have not been offered a new store despite, they say, having been promised one months ago when Emaar first began considering a renovation. "We have received eviction notices, 25 companies," said Anand Datwani, the owner of Kyra Store. "We have been told to hand over our premises and [Emaar] has not guaranteed us a new store and privately they said they would."

Other retailers, however, say they have been given generous terms on new stores in the refurbished souq, with some being offered 25 per cent off their current rent as compensation for moving.

"It's good news, we have some hope and the changes will make it easier for people to come in the souq," said one jeweller who did not want to be named.

The gold souq retailers have been in talks with Emaar Malls Group, a subsidiary of Emaar Properties, for about two years on rent reductions and a redesign of the souq layout to encourage more customer traffic.

While Dubai Mall hosted a record 47 million visitors last year, the Gold Souq's enclosed design and maze-like corridors is disconcerting for shoppers.

A number of entrances are being significantly widened to allow easier access to the souq, which will mean some stores outside the area will also be affected.

The total number of stores in the souq is expected to be cut from more than 200 to about 50, with a large anchor fashion store put in place.

Emaar declined to comment on the Gold Souq refurbishment.

A spokesman for Emaar Malls said in April, however, the redevelopment plan within the Gold Souq occupied less than 2 per cent of the total net leasable area of 350,000 square metres in Dubai Mall.

In January, Emaar agreed to offer free rent to any jeweller if it planned to move in its renovation plans, and so many have been paying nothing in the past seven months.

For a small shop, Emaar charges Dh300,000 (US$81.675) a year in rent. Jewellers say many of their peers reneged on rental contracts in the past year due to the low footfall and left the mall owing millions of dirhams to Emaar.

These issues have now been resolved, jewellers say, which means Emaar can now go ahead with the refurbishment.

"They want to start renovating very quickly and finish quickly so they can start the rent again," said one jeweller. Emaar has indicated the renovation will take six months until January, but many jewellers expect it to be longer due to the complexity of designing and maintaining the look and feel of the souq.

Mr Datwani spent more than Dh1m fitting out and designing his store in the Gold Souq and said he had not recouped any of that cost because the store had never made a profit. "The only time we saw any hope was during the prime months of November through to February," he said.

"We will have a look for a new location somewhere. There will be loss of business, definitely."

Published: August 10, 2011 04:00 AM


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