Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)
Issue link: https://sct.epubxp.com/i/390025
more Hyperstar branches will be operating in Tehran, plus one each in the major cities of Isfahan, Mashhad and Shiraz. "The action is not lim- ited to Tehran, but Tehran is the largest city, with the greatest ability to absorb the largest concentration of new shopping centers," said David Macadam, CEO and vice chairman of the Middle East Council of Shopping Centres, who was one of the speakers at a retail conference MRSC set up in Tehran earlier this year. "Many of the shopping centers in Tehran are part of a larger mixed-use project; land costs are high, and the developers are try- ing to maximize the density." The three biggest malls in Tehran now are the Milad-e Noor (built by Ghods Civil Development Co.), Tirajeh (Poorghazi & Moslehi Developers) and Boostan (Shafei Co.), and none of those exceeds 215,000 square feet of gross leasable area. But cur- rently under construction are three super-regional malls: the Teh- ran Mega Mall (by Mehregan and Ramin Ahmadi in a joint devel- opment with Majid Al Futtaim Group and the government), Tat Mall (by Ali Ansari, a private-sector developer) and Atlas Plaza (by Iranian Atlas). The smallest of these measures 1 million square feet of gross leasable area, and the largest measures twice that. Also of note, says Amiri, are two other large mall projects under construction: On the resort island of Kish, in the Persian Gulf, the Nika Mall (developed by the Dubai-based Keshtkar General Trading Co.) will offer 1.6 million square feet of retail gross leasable area, plus a 100,000-square-foot family entertain- ment center, including a chairlift for rides around the mall and out over the water. And the Dreamland of Padideh Shandiz is an ambitious mixed-use project under development on 50 acres in Mashhad, the country's second-largest city, with a population of some 3 million. This project by Pahlavan Moghadam will contain a five-star hotel, a botanic garden and a water park, as well as an apartment building and a shopping center. Elsewhere Tat Mall's developer, Ansari, is building the Mashhad Mega Mall, with some 1.9 million square feet of gross leasable area. Typically, nearly every space at shopping centers in Iran gets sold to the tenants, but Ansari is moving away from that. "Mr. Ansari is one of the biggest and stron- gest mall developers in Iran," said Amiri. "He's the only de- veloper who constructs malls based on the renting business model and not selling." At present, according to a story in Al Jazeera about Iran's "booming consumer cul- ture," the country's biggest malls are the Isfahan City Centre Mall, with 4.5 mil- lion square feet of gross leasable area, developed by Prestige Land Iran; and the Persian Gulf Complex, still under construction by Seyed Hosseini outside Shi- raz. With nearly 5 million square feet of gross leasable area, Persian Gulf Complex is to have about 1,200 stores, though Amiri describes the layout as a bit haphazard. "One can find a fashion store next to a grocery store," he said. Notwithstanding all this, Iran will undergo a true retail revolution only when international sanctions are lifted, according to Macadam. "No good examples of shopping centers exist," Macadam said, "because there are no global brands to occupy the shopping centers." Observers inside and outside Iran predict that the sanc- tions will be gone within the next year or two, and when that happens, they say, the market could change practically overnight. Amiri says that the United Arab Emirates–based M.H. Alshay Co. and the Lebanon-based Azadea Group have become increasingly interested in Iran; between them they hold the franchises for a handful of international brands, in- cluding Adidas, Benetton, Debenhams, Mango and Zegna. The market potential is tantalizing, according to Charlie Robertson, global chief economist of Renaissance Capital, who was quoted in The Wall Street Journal as saying that once the sanctions are lifted, Iran is "Turkey with oil." Demand is already starting to ripple through the market, half of whose population is younger than 30, and where the literacy rate is about 85 percent. "Despite slow mobile Internet connections, high prices for consumer electronics and tight government censorship of the media, Iranians are frantically buying smartphones, tablets and flat-screen TVs," reported Thomas Cristofoletti in Al Jazeera. "For many young people, shopping has become a near-obsessive ritual. Although tra- ditional bazaars remain the favorite places to shop for most Iranians, they now face stiff competition from huge shopping malls all across the country." Certainly, Macadam sees a bright future here. "The shopping center industry is in its infancy in the Ira- nian market," said Macadam. "New malls will begin to match demand, particularly as new brands are allowed in the country." SCT 68 S C T / O c t O b e r 2 0 1 4 a n a m u s e m e n t i n s i d e t h e p e r s i a n G u l f C o m p l e x , a n e a r l y 5 m i l l i o n - s q u a r e - f o o t m a l l s t i l l u n d e r C o n s t r u C t i o n o u t s i d e s h i r a z . P H O T O © T H O M A S C R I S T O F O L E T T I / R U O M