Dubai's great shopping mall race (page 3 of 3)

Mall of the Emirates will be a must for every tourist; among residents, we will tap the population in the newly developing areas of Dubai. There will not be any significant overlap between City Center and Mall of the Emirates. And we are constantly upgrading and adding value to City Center to ensure that it does not lose its appeal.''

One of the MAF Group's greatest assets, helping to ensure that its shopping malls are a big draw, is the joint venture between MAF and Carrefour. When Deira City Center opened seven years ago, it had a unique feature: the first and the only Carrefour outlet in the Middle East. Such hypermarkets are the proven anchors of shopping malls around the world, and Deira City Center rapidly climbed to take the top slot among Dubai's shopping malls.

Since then, the MAF Group has repeated this strategy in all of its malls. It now owns and operates malls across the region - in the neighboring emirates of Ajman and Sharjah, as well as in Muscat - and it is hardly a coincidence that the Mall of the Emirates will house the largest Carrefour in the Middle East.

Walichnowski says that the group plans to add a shopping center a year in the region for the foreseeable future. "The business has a long gestation period, and there are numerous opportunities in the market. There may be some years when you will have two malls opening and nothing for the year after. But growth will continue."

The larger challenge for the company, says Walichnowski, is to make sure that the Dubai office does not start dictating the terms to everyone else in the group. "That is fatal for any company," he says.

"Here, the executives have been told to travel as much as possible, spend time with consumers to lay out market research and not have any fixed ideas about what's going to work and what's not going to work."

Another challenge for MAF, as it grows across the region, is to have its people discuss issues across the table. "In American and European companies, people disagree openly with their superiors. That's not because there's a lack of respect." he says. "Here, though, people will never challenge you, even if you are totally wrong. So I am trying to create a pool of people who are prepared to challenge each other and not see that as a lack of respect but a collaborative approach.''

Another challenge for Walichnowski lies in maintaining good relationships with his staff across the region. This has become more challenging as he has expanded the company's base rapidly. Walichnowski says his response to the challenge is to hire local people in each country, who bring with them knowledge of not just the local business environment but also the cultural values of the particular country.

"I provide them with my many years of experience, and they show me how they translate that into the local context. I don't know the language or culture and have to rely on my people. The challenge is personal: to be as sensitive as I can to different markets.''

Financially, despite the huge investments being made in the Mall of the Emirates and other projects, Walichnowski says there is little risk for the group.

"The challenge is more in terms of getting the right kind of return from the investments made. We have our own benchmarks and processes to ensure that we get there," he says. "In terms of fresh capital for new projects, Majid has always said that there is no shortage of capital for good ideas. So even if the capital is not available from him, it comes from banks and from our partners.''

In any case, argues Walichnowski, the limits of growth for the group are defined by opportunity rather than capital. "At this point of time, I just can't get enough good sites - in the right location with the right demography - to build more shopping centers,'' he says.

That's a challenge that will soon face every player in the region, as the retail expansion continues. Indeed, the limits of growth are already being tested. The fear - for the Majid Al Futtaim Group, Emaar Properties and others in the sector - is that they have already been crossed. But with a fortune invested in testing those limits, there's no going back now.