UAE Commercial Real Estate Market Size
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2020 - 2022 |
| CAGR | > 6.00 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Need a report that reflects how COVID-19 has impacted this market and its growth?
UAE Commercial Real Estate Market Analysis
- The UAE commercial real estate market is expected to record a CAGR of approximately 6% during the forecast period (2022-2027). The UAE economy has experienced uncertainty within its main drivers in the non-oil industry. The COVID-19 pandemic significantly impacted the travel, hospitality, retail, and real estate sectors.
- Major real estate groups already announced relief packages in 2020 across their business segments, including rent reliefs, deferred payment plans, and waivers of administrative charges, to support their customers and business partners. Major public and private developers are currently focused on ensuring a faster execution of ongoing projects to deliver the best quality product to investors.
- After an uncertain year due to the pandemic, 2021 has seen a big shift in Dubai's commercial property market, with increased prices for sales and leasing. After years of limited supply and decreasing prices, the market started recovering with a surge in demand for sales. The rental prices have been at a nine-year low up to 2021. However, in five years, the prices started rising and stabilizing for the first time in five years. As a result, there has been intensive buying of office spaces by investors and end-users, resulting in a 132% increase in office sales in the first eight months of 2021.
UAE Commercial Real Estate Market Trends
Increase in Demand for Office Spaces across Dubai To Drive the Market
The total stock of office units in Dubai stood at nearly 9 million sq. m of GLA in 2021. Around 70,000 sq. m of GLA (Gross Living Area) was added in H2 2021. An additional 70,000 sq. m of quality office space is expected to enter the market by the end of 2022, with some of the notable projects, including the Obsidier Tower.
The majority of the demand for office units came from small units (less than 1,000 sq. m) with a preference for CAT A fit-out rather than shell and core space. Several new initiatives have been launched to boost demand for commercial real estate in Dubai, such as the introduction of the One Free Zone Passport, which allows free zone companies to extend their operations to mainland Dubai. These initiatives are likely to boost demand for offices across the city in the coming years.
Dubai's commercial property market saw a massive increase in the supply of office space. As a result, there was an oversupply in the market, which caused prices to decrease and led to the shutdown of new major commercial developments. However, in the last few years, increasing demand absorbed the majority of this oversupply. Currently, the demand is starting to outstrip supply. With no new major developments on the horizon, this trend is set to continue and boost prices.
Increase in Hotel Real Estate Across Key Cities in the United Arab Emirates
The total number of hotels and similar establishments in Dubai decreased to 755 in 2021 compared to 1,089 in 2020. The tourism sector added 8% to the country's GDP in 2021. Dubai Expo 2020 boosted tourism in 2021. However, it has a long way to go to reach pre-pandemic levels.
The United Arab Emirates continues to dominate the Middle Eastern travel market with its supply and bookings across all travel segments, which was seen in Expo 2020 in October 2021. After the challenging times of the pandemic, the Expo proved a welcome opportunity for those in the hospitality industry. The benefits of this event are already being noticed in the economy. The Emirates' robust new safety measures deployed across various sectors and major initiatives taken by the government have further cemented the country's position as a safe destination for global travelers.
UAE Commercial Real Estate Industry Overview
The UAE real estate market is fragmented, with the presence of many players. It also has a strong potential for growth. The real estate companies in the United Arab Emirates are seeking to consolidate to rebuild their profits as renewed economic growth is attracting new investments.
The developers are trying to bring new and lower-cost products to meet the current demand. Evolving technological advancements, such as new proptech solutions, are driving the market in terms of increased transactions and better management of real estate assets. Some of the major players in the UAE commercial real estate market include Nakheel properties, Deyaar, Jabal Omar, Aldar, and Rak Properties.
UAE Commercial Real Estate Market Leaders
Nakheel Properties
Deyaar
Jabal Omar
Aldar
RAK Properties
*Disclaimer: Major Players sorted in no particular order
UAE Commercial Real Estate Market News
- March 2022: AD Ports Group signed an agreement with Metal Park Investment ME LTD to establish an integrated metal hub in KIZAD that will cater to all industry verticals and offer scale flexibilities to metal vendors, processors, and fabricators in the United Arab Emirates. The upcoming Metal Park in KIZAD covers a total land area of 450,000 sq. m. It will be equipped with state-of-the-art facilities supporting storage and handling, processing, and fabrication activities while offering access to R&D amenities, rental office space, and associated financial services.
- December 2021: A consortium comprising Aldar Properties and ADQ announced the acquisition of approximately 85.52% of the outstanding share capital of The Sixth of October for Development and Investment SAE.
UAE Commercial Real Estate Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Current Economic Scenario
4.2 Commercial Real Estate Buying Trends - Socioeconomic and Demographic Insights
4.3 Government Initiatives, Regulatory Aspects for Commercial Real Estate Sector
4.4 Insights on Existing and Upcoming Projects
4.5 Insights on Interest Rate Regime for General Economy and Real Estate Lending
4.6 Insights on Rental Yields in Commercial Real Estate Segment
4.7 Insights on Capital Market Penetration and REIT Presence in Commercial Real Estate
4.8 Insights on Public-Private Partnerships in Commercial Real Estate
4.9 Insights on Real Estate Tech and Start-ups Active in Real Estate Segment (Broking, Social Media, Facility Management, Property Management)
4.10 Impact of COVID-19 on the Market
5. MARKET DYNAMICS
5.1 Drivers
5.2 Restraints
5.3 Opportunities
6. MARKET SEGMENTATION
6.1 By Type
6.1.1 Offices
6.1.2 Retail
6.1.3 Industrial
6.1.4 Logistics
6.1.5 Multi-family
6.1.6 Hospitality
6.2 By Key Cities
6.2.1 Dubai
6.2.2 Abu Dhabi
6.2.3 Sharjah
6.2.4 Rest of United Arab Emirates
7. COMPETITIVE LANDSCAPE
7.1 Market Concentration
7.2 Company Profiles
7.2.1 Developers
7.2.1.1 Nakheel Properties
7.2.1.2 Deyaar
7.2.1.3 Jabal Omar
7.2.1.4 Aldar
7.2.1.5 RAK properties
7.2.1.6 Arabtec Constructions
7.2.1.7 Khansaheb
7.2.1.8 Al Habtoor Group LLC
7.2.1.9 Al Sahel Contracting Company
7.2.1.10 Dutco Group of Companies*
- *List Not Exhaustive
8. FUTURE OF THE MARKET
9. APPENDIX
UAE Commercial Real Estate Industry Segmentation
Commercial real estate is a property used exclusively for business-related purposes or to provide a workspace rather than a living space, which would instead constitute the residential real estate. Commercial real estate is often leased to tenants to conduct income-generating activities. In general, it includes buildings used for commercial purposes, such as office buildings, warehouses, and retail buildings (e.g., convenience stores, big-box stores, and shopping malls). This report aims to provide a detailed analysis of the UAE commercial real estate market. It focuses on the market dynamics, technological trends, insights, government initiatives taken in the commercial real estate sector, and COVID-19 impact on the market. Also, it analyzes the key players in the market and the competitive landscape.
The commercial real estate market in the United Arab Emirates is segmented by type and key cities. The report offers market size and forecast for the UAE commercial real estate market in value (USD billion) for the above segments.
| By Type | |
| Offices | |
| Retail | |
| Industrial | |
| Logistics | |
| Multi-family | |
| Hospitality |
| By Key Cities | |
| Dubai | |
| Abu Dhabi | |
| Sharjah | |
| Rest of United Arab Emirates |
UAE Commercial Real Estate Market Research FAQs
What is the current UAE Commercial Real Estate Market size?
The UAE Commercial Real Estate Market is projected to register a CAGR of greater than 6% during the forecast period (2024-2029)
Who are the key players in UAE Commercial Real Estate Market?
Nakheel Properties, Deyaar, Jabal Omar, Aldar and RAK Properties are the major companies operating in the UAE Commercial Real Estate Market.
What years does this UAE Commercial Real Estate Market cover?
The report covers the UAE Commercial Real Estate Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the UAE Commercial Real Estate Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
What are the different segments in the UAE Commercial Real Estate Market?
The different segments covered in the UAE Commercial Real Estate Market are a) Type: Offices, Retail, Industrial, Logistics, Multi-family, and Hospitality b) Location: Dubai, Abu Dhabi, Sharjah, and Rest of United Arab Emirates
Commercial Real Estate in UAE Industry Report
The UAE commercial real estate market is witnessing significant growth and transformation, driven by evolving customer preferences, market trends, and macroeconomic factors. There's a shift towards modern, high-quality properties, with a rising demand for office spaces, retail spaces, and industrial properties featuring state-of-the-art facilities and amenities. Mixed-use developments that blend residential, commercial, and retail spaces are popular for their convenience and accessibility. Sustainability and energy efficiency are becoming crucial for customers, reflecting a growing consciousness about environmental impacts. The UAE's strategic position as a global business hub and its favorable business environment have attracted a broad range of investors, including UAE real estate companies, further stimulating the market. The market is segmented by types such as industrial, multi-family, offices, logistics, hospitality, and retail. The office segment is expected to hold a significant share, driven by new initiatives and the demand for semi-furnished small units, while the retail segment is anticipated to see substantial growth, propelled by the entry of companies into the UAE retail market. Mordor Intelligence™ Industry Reports provide a comprehensive analysis of the UAE Commercial Real Estate market, offering insights into market share, size, revenue growth rate, and forecast outlook. Get a sample of this industry analysis as a free report PDF download.
