Discussing Retail and Lifestyle Developments in Saudi Arabia with Ateeq R. Mogal of Ajdan

Interview with Ateeq R. Mogal, Consultant Retail and Lifestyle at Ajdan

How would you describe the retail sector in Saudi Arabia?

It is a fluid landscape which has changed a lot recently. The good news is it is changing for the better. The new generation of millennials and Gen X and Z are really changing the whole sector. Ten years ago, nobody would walk anywhere. You had valet parking, the driver parked the car and dropped you off. Now, you have women driving and they do not want to go to malls anymore, so there are drive-thrus everywhere. All the coffee shops and other food places you can imagine. It is much more car friendly with more parking needs. On the flipside, people are walking. The sun is something you stay away from in Saudi because it is so hot, whereas in Europe, the sun is something you celebrate. Basically, there are more outdoor centers where people can walk from each shop and there are not so many huge, indoor mega malls. Supermarkets used to be 10,000 square meters and now they are 3,000. There are now a lot of European and American products. The whole health lifestyle has really embraced Saudi Arabia. It is almost like you eat 20 years of junk food before you have 10 years of healthy food. And then you have another 10 years of healthy in-between gourmet. For me, as a property developer, I have had to change as well. I have to change the way I design; I have to change the people who design for me. I use people from the Mediterranean and from Europe, architecture firms with experience in indoor-outdoor spaces. We are working with Gensler and Benoy and we are looking for other architecture firms. They are pioneering ways of doing retail with millennials in mind. People want to be seen now, not hide like before. They want to socialize, so the coffee shop has become a wine bar. People come there to meet and greet. There are members clubs, private clubs, and beach clubs and they are allowing us to experiment with what lifestyle means in Saudi Arabia. To me, lifestyle is what they do on holiday when they go to Cannes, Paris, London, or New York. They spend their time outdoors, they do not want to go to an indoor shopping mall, they want to go outside. What I want to do as a developer, is create that lifestyle all year-round. I think COVID has done that as well, because in the last few years, people could not leave the country. They demanded the same quality of service with the vacations that they had locally.

With the harsh climate, how do you adapt?

Gensler and Benoy are very clever. They have ways of doing shading to create spaces that are comfortable. We call them modular spaces. The days of fixed retail spaces are gone. The landscape, trees and vegetation can help to create the right environment. One of the things people say they miss about Europe is the greenery. The green, natural, fertile habitat, which in the desert is very difficult to do. But there is a way to find a hybrid. What I mean by that is you create with water features, signage, the materials you use, and even the seating you use like dust-free and sand-free instead of black leather, to create its own environment.

How can retail be part of that sort of environment?

You have to listen, so I listen to the retailers and look at things from their angle. When I asked them why they had the best retail experiences in London or Paris, and even at Heathrow Airport, they said they wanted parking, double height facades, quality of amenities and things like that. More and more brands and more and more retailers want to create the same experience you get in the Mediterranean, or Paris or London or New York. And that goes for Apple and some of the technology retailers as well who want to create the same experience globally without any discrimination. For us it is important that women can work, and they are, and it is an environment that everyone can thrive in. It was not a business decision; it was a cultural decision, and it is starting to catch on now and it is in sync. In the last five years, young people in Saudi have wanted to work in retail and want a career in retail like in Europe. Another change is that retailers are now doing specific lines for the region. Monsieur Dutee have the Dubai range, Marks & Spencer have a modest range. Certain other luxury brands are creating longer shawls and ponchos and things that are more culturally accepted. The clothing models are changing too, and a lot of them are now coming from the region. We want to become an inspiration and inspire others to help us because we cannot do it alone. The demands are on us as developers to give retailers what they want and that is what I want to do with my lifestyle project Ajdan Retail. Get people out of the shopping malls and the city and move them to the seafront and make it the central point of gathering and socializing. The next step is to bring brands, resorts, wellness centers and create a mini-Cannes or Monaco kind of feel. I need to empower the boating community to visit our shores from Dubai, Kuwait and other parts of the Aegean Sea, as well as entertainment coming to the seafront whether it is the Red Sea or the east or west coast. Then people will realize that they can go for a holiday in Saudi Arabia. And people living here will be able to get away for a long weekend experience. The good thing about Ajdan is they have the vision, and they have been ahead of the curve by doing projects even before COVID.

What stage is your project at?

One of our projects is already completed. Ajdan Walk is 98% done, meaning shops are open, the AMC cinema is open, restaurants are open, the Ajdan Rise tower is fully sold, and people are moving in. We are still waiting for the hotel to be completed and that is the last phase, but the good thing is that the retail has worked, and the success of that retail has inspired us to do new projects. We have built a name of quality, timing and consistency in our work, so some of the brands and some of the groups we are dealing with want to come to our new projects as well. For me, as a retail lifestyle person, my projects start way before that because I try to bring the brands in from day one. If I can bring them in earlier, I will build for them. One of the new projects, Ajdan Infinity, is ready to start and the other one will be getting the green light soon. The name has not been confirmed yet, but it is called the sandbox and is codenamed Ajdan Bayfront. It is creating a bay and a pier to an island in the center of Al-Khobar, which has a lot of restaurants and a real beachside experience. Ajdan Infinity will start this year and will be completed by 2024. It is very important these days not to make mistakes. I would rather have the retailers working with us from day one. We save money, they save money and then you can create something unique for them.

How do you define Ajdan Infinity?

We have 23,000 square meters of retail space right on the waterfront. Adjacent to that, we have three towers of residential living. That living is to be sold off the plans. After our success in Ajdan Rise, we have created a database and are waiting for investors. There is now a trend of people wanting to live in apartments. Lifestyle has moved to a quick living with couples both working. It is a new thing for Saudi Arabia and high wealth people want a second home, or people want their own apartment. We have found that young people especially are opting for that and so you need a community that has to have restaurants, entertainment and places where they can do everything. For us this is something that is new, whereas in the Mediterranean it has been done for a while and done quite well.

Do you foresee any major challenges?

In my line of work delays are always a challenge. The good thing with us is that every project I have been part of in the last three or four years, even with COVID, has gone according to plan. We are quite disciplined in what we can deliver. Managing the expectations and managing the projects so that we can do them on time and on budget is always going to be a challenge. For me, the biggest challenge is making people believe that everything is ready so come and be part of it. I am always looking for something new, something that has not been done before or does not exist in Saudi Arabia. A new hotel, a new resort, a new operator for a beach club, a new operator for an island, a new entertainment experience, that is what we work toward. Another challenge is changing people’s perceptions and old mindsets, not only in our own country but in the rest of the world. We want to show that change has started and here are the success stories so come and be part of it. We have chefs now coming from all over the world living in Saudi. We want real French chefs and gourmet specialists and we have started to see that in the last four or five years.

Are there similarities in the holiday concept of going to Dubai, Abu Dhabi or Bahrain and Saudi?

Not to compare ourselves with them, we don’t want to copy them. We want to be the lead and do things that even they have not done before. That sounds really cliché, but we have done it in certain things. We have one of the most successful cinemas in our project and it is not even in Riyadh. During Saudi National Day last year, people from Kuwait and Bahrain came to Saudi and that was because Saudi gives them something different. All of us can coexist, all of us are unique and we can all give something different. Every Mediterranean town has its own flavor and own theme. Monaco is Monaco and Cannes is Cannes. I think Al-Khobar and other places will have their own themes, they will give a different customer journey and a totally different and unique tourist experience. People forget Saudi Arabia is huge. Riyadh is larger than Bahrain and Dubai. The challenge is how do you market all of it at once? It can get confusing, there is a lot to take in and people do not really believe it until they come and visit. The traditions and the heritage that we have is hospitality. We have always been known for that and we need to do more of that and bring it as part of our service, and people are embracing that.

Where do you think you can go from here?

We work with local brands, and we bring in the best of what is out there, whether it is a luxury brand, a mass brand, and the idea is to bring it all together as a community and make them all work together. You have a place to live, a place to work, restaurants, coffee shops, entertainment and nightlife so everybody can have that experience at the same standard. All of us as developers, we work together to make sure that we complement each other. There is almost a drive, and a push for each one of us to outdo the other. The difference between us and the others is they are doing it for everybody else and we are doing it for ourselves, as well as everybody else. It is like Egypt for example, it is a huge population, and they are creating new projects and I think Saudi has the capacity to embrace whoever wants to come and join us. The fact that we are now using that as a strength is something that is exciting. It will take time for people to embrace all of it because perceptions are hard to change, however, when you associate the brands that we have and the numbers start speaking for themselves, you start getting more and more interest.

What brands do you have onboard?

The Cheesecake Factory and PF Chang’s are international restaurants that chose us purely because they were looking for a standard and quality of a build and fit-out with parking and everything done the way we have done it. Since then, we have got a couple of fine dining restaurants and hotels we cannot mention yet, but which are good international names. We have also just opened an office building. It is in a retail environment. It is something you see in Europe where people want to work and where they want to dine. And we have the Fairmont Hotel.

What was your experience like at the MIPIM 2022 real estate event?

It was absolutely wonderful. I noticed a lot of people were surprised to meet professionals like us. You change one perception at a time, you cannot change everybody’s perception. If I speak to one person who reaches out to another hundred people and they hear something that they want to find out more about, my job is done. What I am trying to do is change people’s minds and their perceptions. All we are doing is evolving like everyone else in our own space and time. We were not a huge country in terms of people 50 years ago, but people started migrating and the population was growing as well. We are many thousands of years old as a group of people, as an origin, but in terms of a state we are 120 years old. We have taken our time but now people know it is authentic and is not something that is artificial. Anybody can open McDonald’s and Starbucks, but we want to create our own to create our own cuisine, and it is happening. We have fusion, we have fashion designers, we have artists from all parts of Saudi Arabia and hopefully, in the next couple of years, we will start meeting those people at film festivals and we will start telling our story on a mass scale. But today it is one person at a time, and it is a good start.

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