Being a short distance from more populous nations means Bahrain’s retail sector is strongly linked to tourism, with many visitors coming to the kingdom for the express purpose of shopping. Around 11m people drive across the King Fahd Causeway between Saudi Arabia and Bahrain every year, and according to a tourism survey for the third quarter of 2015, shopping was the main purpose of visiting Bahrain for nearly 23% of inbound tourists arriving via the causeway.

EXISTING MALLS: Retail properties have established themselves as important aspects of the kingdom’s tourist landscape, with many flagship properties concentrated on the roads that connect the causeway to Manama, the capital. Two of Bahrain’s largest shopping malls, Bahrain City Centre and Seef Mall, attract over 385,000 and 170,000 visitors per week, respectively, according to a 2016 tourism White Paper released by the Bahrain Economic Development Board (EDB). Bahrain City Centre is a 450,000-sq-metre, multi-purpose property with 350 retail outlets, a 20-screen cinema and the biggest indoor-outdoor water park in the region. Seef Mall has 370 retail outlets as well as over 50 food and beverage offerings.

In December 2015 Dragon City Bahrain, a Chinese-themed mall, opened in Diyar Al Muharraq, featuring 500 Chinese businesses in a 50,000-sq-metre market, along with a warehouse facility, a leisure complex and restaurants. “Bahrain’s location at the heart of the Gulf and its position as a regional centre for business, trade and tourism give our tenants an unrivalled opportunity to sell their products across the region, particularly in Saudi Arabia, the biggest economy in the GCC, which is just a short drive across the King Fahd Causeway,” Hao Feng, chairman of China Middle East Investment and Trade Promotion Centre, the mall’s management company, said at its opening.

In total, more than 30 shopping complexes operate across the island, according to the EDB. In addition to these centres, visitors to Bahrain also spend time and money at the kingdom’s traditional souqs, especially in Manama and Muharraq, which have increasingly been promoted as tourist destinations.

RETAIL AS A SERVICE: Retail and tourism are becoming increasingly intertwined in Bahrain and the atmosphere is conducive for growth. “There is a lot of interest in the retail sector,” Jerad Bachar, executive director of tourism and leisure at the EDB, told OBG. “Lots of new projects are in the works. For example, The Avenues is a major retail attraction with space for attractions and activities, as well as being a retail centre. It will certainly be a destination in itself.” Avenues Bahrain, located just off of the King Fahd Causeway in central Manama, is due to open in 2017. When complete, the BD45m ($119.4m) mall will occupy a 1.5-km stretch of seafront, with 38,000 sq metres of gross leasable area and a range of facilities, including waterfront dining, a running track and gym, and a traditional souq.

In addition, the overall retail environment of the country is welcoming and upscale. “Bahrain is more suited for high-end retail than anywhere else in the region, as service is more quality-oriented than it is focused on quickly pushing purchases onto customers,” Mohammed Jaffar, chairman of Asia Jewellers, told OBG.

Moreover, to further promote the retail sector, the kingdom launched an annual Shopping Festival in 2015 with the 2016 event seeing sales of approximately $30m. This festival has the capacity to become a solid addition to retail tourism in the years ahead.

FUTURE EXPANSION: Despite the number of large-scale malls already in operation, there are still significant opportunities for growth and investment in the retail sector. The expanding of the international airport will likely bring many more tourists to the country, while retail investors will watch with interest the expansion plans for the second causeway between Bahrain and Saudi Arabia. “Retail developers are very conscious of what is going on, especially with regards to the increase of travellers through the causeway,” said Bachar.