Commercialprojects may2014

24

bq | COVER STORY l COMMERCIAL PROJECTS

Qatar

Great Expectations Qatar’s massive new commercial development projects aim to tackle urban sprawl

By Rohan Soman and Shereen D’Souza, Doha

Decades ago, several large cities around the world adopted urban consolidation policies in order to make urban areas more compact.

As economies grew, public transport networks expanded and businesses started branching out. A good chunk of the lower income segment and middle class households moved to areas around the main cities, or suburbs and cities like London experienced these movements in the first half of the 19th century.

The United Kingdom adopted a Green Belt policy to control urban growth by having a ring of countryside where urbanisation would be resisted for the foreseeable future, maintaining an area where agriculture, forestry and outdoor leisure could prevail. Paris and New York reached this point towards the end of the 19th century and at the turn of the 20th century, respectively. Migrating to the suburbs gradually softened the population density gradient of these cities.

As Qatar is currently witnessing the instant urbanisation trend, the government is entirely focused on keeping pace with the population explosion the country’s capital, Doha, is sailing towards. Latest figures (31 March 2014) released by Qatar Statistics Authority reveal the population in Qatar stands at 2,144,101 persons. Early last year, Qatar’s population crossed 1.9 million, a figure that wasn’t expected even until 2016, according to the National Development Strategy estimates.

According to indexmundi.com, the percentage of urban population out of the total population in Qatar, as on 2013, stands at an incredible 98 percent. In 2010, there were 796,947 people living in Doha city, in a mere 234 square kilometre area. There is a noticeable disparity in the distribution of population around the country when the population in Doha area is compared to other municipalities like Al Khor, Ar Rayyan and Al Wakrah. Al Khor is spread over an area

of 1,551 sq. km and had a population of 193,983 in 2010. Ar Rayyan (5,818 sq. km) and Al Wakrah (2,520 sq. km) were populated by 455,623 and 141,222 people respectively.

Although Qatar is still lagging behind with regard to urban consolidation, the new commercial projects that are presently underway seek to tackle the current overcrowding of the heart of the country.

Three massive commercial development projects, in the planning and implementation stage in the country, aim to ease the shortage of commercial space, including shops, in Doha and other parts of the country.

One of the projects relates to developing at least 34 Commercial Streets in Doha, Al Rayyan, Al Wakra and other places, while the

www.bqdoha.com

BQ MAY PAGES FINAL.indd 24

4/28/2014 12:36:48 PM

bq | COVER STORY l COMMERCIAL PROJECTS

25

Inside view of Leadenhall Market, Gracechurch Street, London, UK. The market dates back to the 14th Century but was renovated in the early of 1990s.

other project, Al Furjan, (plural of the Arabic word ‘Fereej’ which means locality or area) in collaboration with the Qatar Development Bank, aims to build commercial centres in places outside of Doha so that residents of those areas do not have to come to Doha for their everyday household needs.

The third and last project might yet be at the planning stage. It is about developing community-style shopping centres in each of the localities of Doha, Al Rayyan, Al Wakra and other towns where neighbourhood

stores like grocery, tailoring and barber shops as well as other service-oriented outlets like butcheries, bakeries and laundries could be clubbed together.

According to community sources, people are generally confused while referring to the three projects as many seem to think they are the same, about setting shops in different areas of the country. “All three projects are different, although all of them eventually aim to ease the shortage of shops and commercial spaces like offices in different towns, including Doha. The

office space being generated would mainly be for consultancies,” says a community source familiar with the projects in remarks to bq.

Easing shortages According to the Central Municipal Council (CMC), representative body of the private sector, besides the three projects, plans are afoot to set up Central Markets in towns such as Al Wakra, Umm Salal Ali (close to Umm Salal Mohamed) and Al Rayyan, among other places. These central markets would

www.bqdoha.com

BQ MAY PAGES FINAL.indd 25

4/28/2014 12:36:51 PM

bq | COVER STORY l COMMERCIAL PROJECTS

26

Qatari businessman Ahmed Al Rayes

Doha's Souq Waqif

be along the lines of those that already exist for fresh fruit and vegetable, fish, livestock and meat and wholesale grocery.

Talking of the government’s plans to develop commercial streets, the Chairman of the CMC, Saud Abdullah Al Hanzab, tells bq that once the 34 commercial streets are completed, they will help end the shortage of shops in different places in the country, which is currently acute. “These streets will contain malls, shopping centres, restaurants and all types of business activities that will be needed by residents of Qatar,” he says.

Al Hanzab says that escalating rents of shops has had a negative impact on price rise. “So, when rents are down, the common man will heave a sigh of relief. The prices of goods and services in general are already high in Qatar as compared to the neighbouring GCC countries.” According to the CMC, of the 34 streets that are planned 20 have already been announced by the government. The announcements were made late last year (2013). The first announcement was made for a lot of nine commercial streets and then for 11 others.

The new commercial streets Most of the roads that are to be converted into commercial streets are in Doha and they include New Doha Street, Al Nada Street, Al Furousiya Street, Madinat Khalifa Street, Al Wefaq Street, Kaybar Street, Othman Bin Affan Street, Rawdat Al Khail (al Muntazah) and Ibn Khaldoon Streets.

Outside of Doha, the thoroughfares that

According to the Central Municipal Council (CMC), besides the three projects, plans are afoot to set up Central Markets in towns such as Al Wakra, Umm Salal Ali (close to Umm Salal Mohamed) and Al Rayyan, among other places are to be converted into commercial streets include Al Wajba Road, Umm Salal Street, Old Al Rayyan Street, Simaisma Street and Halul Street in Abu Hamour. The last one, Halul Street, is to be exclusively earmarked for office space for consultancies like engineering, accounting, legal and audit offices. Most of these consultancies have been operating from villas in residential areas and have been asked to move to designated areas. The consultancies have been complaining that they can’t move to West Bay due to the exorbitant rents of office space.

If bq sources are to be believed, the 34 commercial streets will accommodate one line of business each or related businesses.

“You could have all the car showrooms on one street, while another street might

accommodate furniture and furnishings shops,” assumes prominent Qatari businessman Ahmed Al Rayes. Al Hanzab, however, prefers diversity in the area, so it’s easy for shoppers to have all of their needs addressed without a lot of movement, thus easing traffic and crowding.

“The CMC has asked the Ministry of Municipality and Urban Planning to reexamine the allocation of lands for the establishment of central markets to cover all internal and external areas of the State and to consider all the future requirements of these markets, including all the facilities that should be available. We’ve also asked for a redesign of the architecture to be uniform and inspired by Qatari architecture.

“We had previously asked that priority be given to the owners of small shops (baqalas) located in the middle of residential neighbourhoods because the licenses of these shops will expire over the next few years, in 2017, and they must be compensated by creating alternative spaces for them.” The CMC has also requested allocation of available government land for these neighbourhood stores in purpose-built community shopping complexes in every residential area; as well as the expansion of commercial complexes, malls and shopping centres away from Doha to avoid the severe congestion currently witnessed in the capital.

Al Rayes says all the main roads in Doha should be allocated for business. “This happens everywhere in the world. Every building, barring villas, must have shops on the ground floor. Go to Abu Dhabi or Paris or London, everywhere you notice this pattern, so why should we be any different?”

High rents are due to shortage Al Rayes tells bq that it is only due to the severe shortage of shops that rents are so high. “On top of it, the law allows yearly increase in rents. This is not justified,” he insists. “If I am paying QR15, 000 as monthly rent for a shop and if the landlord raises the rent annually I will be paying QR20, 000 in just a few years. This is quite exorbitant a sum as rent for a small shop.”

www.bqdoha.com

BQ MAY PAGES FINAL.indd 26

4/28/2014 12:36:53 PM

bq | COVER STORY l COMMERCIAL PROJECTS

27

H E Saud Abdullah Al Hanzab, chairman, CMC

He goes on to cite Al Shafi Street in Al Rayyan as an example, where a small singledoor shop commands a monthly rent of QR30,000. “With such skyrocketing rents do you think you would be able to sustain any small business you are operating from such a shop?” he asks referring to maintenance and utility bills, staff salaries and their accommodation besides rent. He says a law is urgently needed whereby rents of residential units cannot be raised by landlords for at least three years and those of commercial properties, especially shops, for at least five years.

According to market sources, tenants of shops all over the country fear being asked by their property owners to vacate, and that is why they are not able to spend more on interiors or expand their businesses. A shopkeeper from the Old Airport area of Doha tells bq his shop rent went up phenomenally over a couple of years when it was increased by the landlord starting with a sudden arbitrary rise from QR3,000 to QR10,000.

The shopkeeper went to the municipal Rent Dispute Resolution Committee for redress and then to court, but in vain. The court,

Al Khor commercial street progressing

Gulf Consolidated Contractors were recently awarded with the development and upgradation of infrastructure for the commercial street in Al Khor.

The contract is worth QR 245,070,362 and is due for completion by the last quarter of 2015. The project includes upgrading the current roads and developing new ones along with drainage systems. There will be service roads, parking bays and signal controlled junctions to improve commercial and residential access and ease traffic flow.

Doha's Al Miqrab Street (Photo: Bosco Menezes)

Halul Street is to be exclusively earmarked for office space for consultancies like engineering, accounting, legal and audit offices.. these consultancies have been operating from villas in residential areas and have been asked to move to designated areas

relocate neighborhood stores and service shops. Once these projects are completed, shops should be available easily, hopes Al Rayes.

Al Rayes, Qatar Chamber board member, Nasser Al Meer, and Al Hanzab, however, say they have no idea when these projects will be completed. Al Hanzab, though, says the CMC has asked the government to keep the CMC updated on the progress especially of the Commercial Streets project.

on the contrary, took a lenient view of his plight and gave him the option of settling out-of-court with his landlord. He accepted the proposition because his business was suffering. “I am now paying QR13,000 as rent,” he says.

5,000 plus new shops Market sources say they do not have exact details but expect that the 34 proposed commercial streets might add some 5,000 shops and showrooms on the market and that would considerably ease the shortage of commercial space, particularly in Doha.

Another 600 shops are to be developed by the 44-odd Al Furjan Markets that are to be built outside of Doha. And then there are plans to build community shopping complexes in each residential locality to

* Names have been withheld to protect the identities of the people

www.bqdoha.com

BQ MAY PAGES FINAL.indd 27

4/28/2014 12:36:58 PM