Dubai’s commercial real estate sector is witnessing an unprecedented surge in demand, with prime office spaces projected to see annual appreciation of up to 12 per cent this year, industry players said.
The Dubai International Financial Centre (DIFC) and Business Bay are leading the demand for premium commercial spaces in the emirate, and are expected to be the focal points for continued commercial investments by real estate companies.
These areas are also expected to see up to 20 per cent spike in rentals this year upon renewals in Grade A and B buildings, they said.
“As Dubai strengthens its position as a global business hub, we expect commercial property values to rise further, with prime office spaces seeing annual appreciation of 8-12 per cent,” Anis Sajan, Vice Chairman of Danube Group, told Arabian Business.
“DIFC and Business Bay are leading the way for premium office space demand, with the former remaining the major financial hub, attracting global banks, wealth management firms, and fintech startups, while Business Bay emerging as the go-to destination for corporate offices and multinational companies,” he said.
Sajan said these areas will continue to be the focal point for commercial investments in the coming months and years.
Jatiinder Juss, Director at Dubai-based RedRock Real Estate, said in 2025, foreign investors are expected to focus on high-yield assets in prime locations such as DIFC, Business Bay, and Downtown Dubai, further boosting the city’s commercial real estate sector.
“Dubai’s commercial real estate market has long been a beacon for global investors, driven by the city’s strategic location, dynamic economy, and visionary development. As we move into 2025, this sector is poised for transformative growth, reflecting broader economic trends, technological advancements, and shifts in demand,” Juss said.
Dubai commercial real estate opportunities
Juss said Dubai’s commercial real estate market in 2025 is expected to offer a wealth of opportunities for investors, developers, and businesses.
The city’s commitment to innovation, sustainability, and global connectivity ensures a dynamic and resilient market poised for long-term growth, he said.
The RedRock Real Estate senior executive said mixed-use developments are also predicted to dominate the commercial real estate landscape in 2025.
“These integrated spaces, which combine residential, retail, and office components, cater to Dubai’s growing preference for convenience and sustainable urban living.
“Areas like Dubai South, Business Bay, and Expo City Dubai are at the forefront of this trend, offering self-contained ecosystems for businesses and residents alike,” he said.
The Danube Vice Chairman, however, said despite the surge in demand for high-grade office spaces, commercial real estate is not expected to outperform the residential sector in Dubai this year.
“The residential real estate will remain the dominant sector due to higher transaction volumes and continued end-user demand,” he said.
Senior executives at other developers said Dubai’s strategic location as a global trade and logistics hub will also drive demand for industrial spaces, particularly warehouses this year.
The continued boom in the e-commerce sector in the emirate – as also across the UAE – fuelled by a tech-savvy population and advanced logistics infrastructure – are cited as the major drivers for warehouses and other industrial spaces this year amidst businesses seeking large, flexible spaces to support their supply chain operations.
Free zones like Jebel Ali Free Zone (JAFZA) and Dubai South are expected to see increased activity on this front.
Commercial real estate trends
Industry insiders said the demand for commercial real estate, especially high-grade office spaces this year will be focused on adaptable office layouts, smart facilities, and proximity to key business districts.
In 2025, Grade A office spaces in areas like DIFC and Business Bay will continue to attract multinational corporations seeking a prestigious address and modern amenities, they said.
The Danube Vice Chairman said the demand spike is expected to lead to an up to 20 per cent jump in rentals this year, especially businesses going for renewals in Grade A and B buildings.
Juss said proptech is also expected to further revolutionise the commercial real estate market in Dubai this year, adding to the demand and rental surges.
“From AI-powered tenant management systems to blockchain-enabled property transactions, technology will enhance efficiency, transparency, and customer experiences,” he said.
Dubai’s investor-friendly policies, including the introduction of long-term visas and 100 per cent foreign ownership in select sectors are also cited as factors which will continue to attract global capital in the emirate’s commercial real estate sector.
Sajan said Dubai’s real estate boom is driven by a combination of world-class infrastructure, a vibrant mix of Eastern and Western cultures, a thriving hospitality and nightlife scene, and, most importantly, unparalleled safety.
“The city has firmly positioned itself as a ‘home away from home’ for global investors, professionals, and expatriates seeking stability and long-term growth.
“Besides, geopolitical uncertainty in other regions has also further enhanced Dubai’s appeal, as people look for a safe, business-friendly environment,” the Danube Vice Chairman said.
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