Saudi real estate firm cancels management deals with two Madinah hotels


DUBAI: Dubai’s Majid Al Futtaim recorded a 188 percent rise in its online sales in 2020, meaning its overall retail revenue for the year decreased by just 1 percent year-on-year.

The dramatic rise in online sales at the retailer, which operates more than 350 Carrefour outlets across the Middle East, Africa and Asia, came as workers were forced to stay at home and many governments imposed restrictions on movement in a bid to curtail the spread of the coronavirus (COVID-19).

In March, as the financial impact of the pandemic took hold, MAF launched a staff redeployment program. It moved 1,015 employees from its other divisions, including VOX Cinemas, Magic Planet, and Ski Dubai in the UAE, Saudi Arabia, Egypt, Oman, and Lebanon, to new roles at its Carrefour online order fulfilment center and assigned them to food packing, stock replenishment and processing online orders.

In July, Majid Al Futtaim began converting some of its stores, which were closed in the wake of the pandemic, into fulfilment centers and built a 5,000 square meter center in just five weeks to handle up to 5,000 online orders per day. More than 40 physical stores were converted into fulfilment centers to process online sales.

Carrefour said at the height of the pandemic, online sales increased by 300 percent in the UAE and 100 percent in Saudi Arabia.

Overall, MAF, which employees 43,000 people in 17 markets and owns and operates 27 shopping malls, 13 hotels and four mixed-use communities, reported a 7 percent year-on-year fall in revenues to AED32.6 billion ($8.88 billion), resulting in a net loss of AD2.7 billion, compared to a loss of AED1.9 billion in 2019.

Majid Al Futtaim CEO Alain Bejjani said in a statement: “The pandemic has not only been a financial crisis, but an even bigger crisis of trust. We have built our organization to withstand adverse economic conditions, so our primary focus was on acting swiftly to protect our customers and employees, as we worked diligently to restore trust and maintain non-negotiable commitments to our sustainable business practices.”

With many of its malls and stores closed during the pandemic, Majid Al Futtaim announced it would forgo rent at its 27 shopping malls across five markets to ease the financial burden on its tenants.

In its yearly report, Majid Al Futtaim said tenant sales had begun to rebound towards the end of the year, going from a decline of 52 percent year-on-year in Q2 2020 to 3 percent in the last quarter of 2020.

Looking across its operations, revenue in its mall division was down 24 percent to AED3.5 billion and its hotels recorded a 60 percent drop in occupancy rates, while the biggest impact was felt in the Majid Al Futtaim – Ventures division, which manages its leisure, entertainment and cinema assets, where revenue fell 49 percent to AED1.4 billion.

Focusing on 2021, Majid Al Futtaim plans to continue its expansion plans, with the opening of City Centre Al Zahia in Sharjah and Mall of Oman…



Read More: Saudi real estate firm cancels management deals with two Madinah hotels

728×90