Dubai Commercial Real Estate Market – Strong Growth & Positive outlook (2025/2026)
Here’s a summary of the key takeaways from the provided text regarding the Dubai commercial real estate market:
Key Trends & Growth Drivers:
* Important Transaction Volume: Commercial real estate sales in Dubai reached 69.19 billion dirhams in the first eight months of the year (likely 2025), a 72% increase year-over-year (compared to 40.28 billion dirhams in 2024).
* High Demand & Low Vacancy: The market is experiencing strong demand for both offices and commercial stores, particularly in key areas like the Dubai World Financial Center and Commercial Gulf. Occupancy rates are very high, exceeding 92% overall.
* Low Vacancy Rates: Average office vacancy is only 7.7% (Q2 2025). Premium “Category A” offices have exceptionally low vacancy rates of 0.3% and 3.5% respectively.
* Rental Revenue Increase: Rental revenues in the commercial sector have increased by over 22% due to high demand and limited supply.
* Infrastructure Development: Major projects like the new “blue metro line” are boosting interest in surrounding areas and improving infrastructure.
* Government Policies: Policies like full foreign ownership and the gold residence programme are attracting investors and encouraging business expansion.
* Tourism Impact: Dubai’s strong tourism sector (over 11 million visitors mid-year) is driving demand for shops and hotels, positively impacting real estate.
* Flexible Offices Popularity: ”Flexible offices” are becoming increasingly popular with international companies seeking modern, adaptable solutions.
* Institutional Investor Interest: the market is evolving into a “low-sized market” attracting institutional investors and forward-thinking companies.
Price Points & Performance:
* Average City Center Office Price: 5000 dirhams per square foot.
* Bay Al-Suhair Area Price: Exceeded 2000 dirhams per square foot for the first time.
* First-Class Office Occupancy: Reaching 100%.
* Industrial Sector Occupancy: 97%.
* High-Value Transactions: 83 office transactions exceeding 10 million dirhams were completed in the first half of 2025.
Future Outlook:
* Strong Growth Potential: Experts believe dubai offers a stable and growing real estate investment future.
* Investment Recommendation: Investors are encouraged to diversify portfolios with modern offices and major commercial projects.
* Continued Momentum: The market is expected to continue its positive trajectory into 2026 due to its strong infrastructure and ongoing projects.
In essence, the Dubai commercial real estate market is currently thriving, driven by a combination of economic growth, government initiatives, infrastructure development, and a strong tourism sector. The outlook for continued growth, particularly in 2026, is very positive.
