The UAE’s office sector has shown strong performance in the second quarter of 2024, according to JLL’s UAE Real Estate Market Overview report.
The growth is attributed to a “strong economy, diverse demand, and occupiers’ focus on quality spaces and sustainability,” the report said.
It further highlighted increases in office space, rising rents, and decreasing vacancy rates in both Dubai and Abu Dhabi.
Dubai’s office gross leasable area (GLA) expanded by 20,000 sq. m., bringing the total stock to 9.26 million sq. m. Abu Dhabi’s total stock remained at 3.95 million sq. m., with a limited delivery of 7,500 sq. m.
However, in the second half of the year, an additional 125,000 sq. m. is scheduled for completion, the report said.
Rents in both cities increased, with Dubai’s central business district (CBD) seeing a 15 percent year-on-year rise to AED2,630 per sq. m. per annum.
Abu Dhabi’s average Grade A rents increased by 10 percent to AED2,085 per sq. m. per annum.
“In the first six months of 2024, developers in the commercial real estate sector launched a number of new projects in both Dubai and Abu Dhabi to alleviate constraints in the long-term and meet the growing demands of occupiers seeking quality office spaces that are also sustainable in nature. With over 140,000 sq. m. of space planned to be delivered by the end of this year, we can expect to attract new companies as the UAE cements its position as a global hub for business setup,” Faraz Ahmed, Research Director at JLL MENA said.
Dubai and Abu Dhabi real estate: Rising home prices
The residential sector also performed well, with Dubai experiencing a 28 percent increase in value and a 34 percent rise in the volume of residential sales transactions from H1 2023 to H1 2024.
Sale prices in Dubai increased by 20 percent year-on-year, while Abu Dhabi saw increases of 8 percent for villas and 6 percent for apartments.
The retail market saw significant rent increases, with Dubai reporting a 16 percent year-on-year rise in average rental rates in primary and secondary malls, and Abu Dhabi recording an 11 percent increase.
The hospitality sector defied the traditionally slower summer season, with both Dubai and Abu Dhabi reporting strong growth in hotel performance figures.
Dubai’s Average Daily Rates (ADR) grew by 5 percent year-on-year, while Abu Dhabi saw a 13 percent increase.
In the industrial market, warehouse rents across all submarkets in Dubai experienced a 14 percent year-on-year growth in Q2.
Abu Dhabi’s average warehouse rents surged 10 percent year-on-year in the same period.
Follow us on
