DUBAI - A UAE developer with the licence to operate Carrefour SA stores in the Middle East is looking to boost its presence in Iran after opening a new hypermarket in the Islamic republic to tap demand for modern shopping centres.
Majid Al Futtaim Properties, known for building an indoor ski slope in the Gulf's trade and tourism hub Dubai, is turning to Iran as it looks to add as many as 10 malls over five years in the Middle East and north Africa, the group's chief executive told Reuters in an interview on Monday.
Peter Walichnowski said the company was looking to launch a mega-mall project in Iran by 2012 after its latest retail project in the country's capital proved successful.
"It's a big city (which has) affluence and not a lot of choice in terms of where to spend money on retail and entertainment," he said. "Many Iranians come to Dubai for a holiday and they want to see a Mall of the Emirates there," he said, referring to a mall in Dubai.
Investment by foreign companies in Iran has been slowed by a combination of political infighting, tough investment terms and international sanctions over Iran's nuclear activities.
"When you go there you find the politics are different to local dynamics of business ... the government is much more involved in international politics than mucking around with local economics," he said.
Iranian consumers had already demonstrated their love for the idea of a hypermarket, he said, adding he didn't think there was much risk in building a project in there.
MAF, owned by billionaire UAE businessman Majid al-Futtaim, traditionally enters markets with Carrefour as anchor tenant of its malls and recently opened a local version of the hypermarket in Iran's capital.
The former CEO of Dubai's Omniyat Properties said Carrefour, the world's second-biggest retailer after Wal-Mart Stores Inc, was negotiating on a number of sites in Tehran to build more stores.
"They can build single stores faster than we build shopping malls," he said. "We are continuing to have discussions with landowners and the authorities in Tehran to find something suitable."
French daily newspaper Le Monde reported on Sept. 28 Carrefour was under pressure from big shareholders to exit emerging markets such as China and Brazil.
MAF Properties is also focusing on building large shopping centres across the rest of the region. It currently operates and is building malls in the Gulf Arab region and Egypt.
It is focusing on the Levant market with three shopping malls planned in Syria and Lebanon. In Syria, it is building a $1 billion mall to be completed in the next three years, he said.
In Egypt, the company is planning a third project in Cairo, the Mall of Egypt. "We are looking at the entertainment and leisure component and at this point we are attracted to providing a ski slope because of the nature of the market and the uniqueness of that kind of offering in Cairo," he said.
The company is also eyeing new projects in Saudi Arabia, Yemen, and Oman. "We are looking at between eight and 10 new malls in the MENA region over the next five years, including announced projects," he said.