For instance, while a country like South Africa with the same population as Tanzania has an estimated space of 23 million square meters of shopping centres — more than seven times as much as the rest of Sub Saharan Africa - Dar es Salaam has only 107,000 square meters of shopping malls space, according to a report by Knight Frank.
Dar es Salaam has very few shopping malls that meet international standards; this is after the entry of Mlimani City Malls in 2006.
However, given the business profile of Dar es Salaam, analysts in the property market say shopping malls like Mlimani City are still too small to lift the profile of the country’s economic hub to international standards.
Nairobi is still the market leader in East Africa, with an estimated 400,000 square meters of shopping malls — with another 470,000 square meters expected in the next few years.
According to the Knight Frank report titled, “Sub-Saharan Africa Shopping Centre Development Trend”, Dar es Salaam - the home to nearly five million people — still lags behind Nairobi and Kampala in terms of the existing shopping spaces. Te report was released last month in Dar es Salaam.
Kampala has 182,000 square meters of existing shopping malls.
But with the ongoing major construction done by key players in the real estate industry like National Housing Corporation (NHC) and pension funds, Dar es Salaam stands a better chance to have enough space for shopping malls in the next decade.
This would, however, depend on a number of factors like development in modern infrastructure, especially roads, consumer spending power and behaviour and sound investment policies in the sector.
Geographically, Dar es Salaam is well positioned than its two key competitors, Nairobi and Kampala, because of its accessibility to the sea and air — which are the key components in the movement of goods and people.
Knight Frank’s research has identified Nairobi, Luanda, Lagos, Dar es Salaam and Maputo as cities with the five largest shopping centres development pipelines in Sub-Saharan Africa, excluding South Africa.
All of these cities fit the profile currently targeted by investors on the continent, as large, fast growing cities in economies that have seen rapid recent expansion.
Completing for the top five hotspots are Dar es Salaam, where shopping centres development is currently accelerating having previously lagged behind Nairobi, its main regional rival in East Africa; and Maputo, where retail development has grown as part of a construction boom that has been largely driven by recent offshore gas discoveries.
In their report, Knight Frank, says: “Given that South Africa alone has more than seven times shopping more space than the rest of Sub-Saharan Africa, there would appear to be room for considerable retail development across the region.
At present, the largest shopping centre market in the area covered by this report is Nairobi, with nearly 400,000 square metres of shopping centre space.
However, it is significant that the second and third largest markets by floor space are Windhoek and Gaborone, two small capital cities in Southern Africa, albeit in relatively mature and megacities such as Lagos and Kinshasa, says the report.
The report says have less floor space than Windhoek and Gaborone, which are a fraction of their size, illustrates how much further their retail markets have to grow.
A range of local, regional and international operators are driving retail market activity across Africa. The newly developed malls of Sub- Saharan Africa are absorbing demand from a variety of retailers seeking to expand their footprint in the region. South African retailers such as Shoprite, Pick n Pay, Game and Woolworths are particularly prominent, anchoring many of the most modern malls.
Other growing regional retailers include the Kenyan supermarket operators Nakumatt and Uchumi which have been opening stores throughout East Africa, while Botswana’s Choppies chain is on an expansion drive in Southern and East Africa.
However, there is now growing interest in the wider Sub-Saharan region from major international retail groups.
The French supermarket chain Carrefour has made inroads in Francophone Africa and is also poised to enter the Kenyan market this year.
Wal-Mart has made progress in Africa via its acquisition in 2012 of a majority stake in Massmart, which operates brands such as Game in Africa. Other international brands are present in the region’s premier malls.
For example, there are Hugo Boss, Levi’s and Lacoste stores at the Palms Mall in Lagos, while Mango, Aldo and Benetton are at Sea Plaza in Dakar.
Most international brands enter the region through partnerships with local operators or franchise agreements.