Umm Al Quwain an ‘investment hotspot’ in UAE, say real estate experts

The northern emirate, known for its 23 km of coastline and natural landscapes, is experiencing increased investor interest as neighbouring property markets reach maturity and price points that exclude many buyers.

In an exclusive interview with Arabian Business, Andrew Cummings, Head of Residential Agency at Savills Middle East, attributes the growth to a broader trend of investment focus shifting to the northern emirates.

Umm Al Quwain’s rising market potential

“The renewed focus on northern emirates as investment hotspots is playing a key role, particularly with the rise of Ras Al Khaimah following the Wynn announcement. Umm Al Quwain is emerging as a natural alternative, offering early-stage opportunities in a market still in its growth phase,” Cummings explained.

Major masterplan developments, specifically Sobha Siniya Island and Downtown UAQ | Sobha Realty in Umm Al Quwain, have become the primary investment catalysts in the emirate.

These flagship projects, delivered through strategic partnerships between the government and established developers like Sobha Realty, are transforming the landscape and driving market growth.

“With its serene natural landscape and rich cultural heritage, Umm Al Quwain is now entering a new phase, led by a bold and ambitious vision for sustainable growth and urban development,” Francis Alfred, Managing Director at Sobha Realty told Arabian Business.

Alfred further explained that the company’s expansion into Umm Al Quwain aligns with their long-term vision to extend luxury living options across the UAE.

The developer’s recently announced Downtown UAQ | Sobha Realty, is a 25 million sq. ft. coastal “city within a city” masterplan featuring 11 km of shoreline, with 7 km dedicated to beaches and beach parks.

According to Alfred, the development will be divided into three districts covering entertainment, residential and commercial purposes, with over 50 per cent allocated to green and open spaces.

The project focuses on apartment buildings with 1 & 2-bedroom apartments and 3-bedroom duplex options, starting from AED 1.11 million.

High-yield investment potential

For investors and first-time buyers, the emirate offers an opportunity to enter the market at prices significantly lower than Dubai or Sharjah.

“Downtown UAQ | Sobha Realty offers an exceptional entry point for first-time buyers, allowing them to invest in a flagship master-planned community during its formative phase,” Alfred explained.

He added that investors can expect annual rental yields in the range of 7-9 per cent, making it “a compelling opportunity for both passive income and asset growth.”

This assessment aligns with Cummings’ view, who noted that “gross yields of 6-8 per cent are achievable, particularly in the villa segment. With capital values still on the rise, there is upside potential for investors entering at this stage” in the emirate overall.

The property market in Umm Al Quwain has shown “consistent upward momentum since 2020,” according to Alfred, reflecting infrastructure development and the emirate’s growing profile.

Waterfront villas and off-plan residential units in new masterplans are performing well, with buyers seeking lifestyle-led communities that offer potential for long-term capital appreciation.

The buyer demographic spans regional investors, mid-income end users, and those priced out of neighbouring markets.

Cummings also noted a “growing base of buyers who are seeing this as a second-home market with strong future upside.”

Government involvement has been crucial to this development trajectory. “The government has played a clear role by enabling large-scale partnerships with trusted developers and prioritising long-term infrastructure planning,” Cummings explained.

Sobha Realty’s Alfred further highlighted their partnership with the Government of Umm Al Quwain as reflecting “a shared vision to create a future-proof destination that balances economic growth with environmental preservation.”

The Downtown UAQ | Sobha Realty project includes major road, utility, and coastal infrastructure improvements, with provisions for commercial zones and free trade operations.

While the growth outlook appears positive, challenges remain. Cummings identified awareness and infrastructure delivery timelines as potential obstacles.

“As with any emerging market, consistent execution will be key to sustaining momentum and building long-term buyer confidence,” he stated.

Alfred pointed to Sobha Realty’s “Backward Integration” business model as key to maintaining quality while keeping prices accessible.

“Unlike traditional development business models that rely on multiple external contractors, vendors, and service providers, we maintain complete in-house control over every aspect of the development process, from design to engineering, manufacturing, and construction,” he explained.

This approach, he added, protects projects from global supply chain volatility and price fluctuations by sourcing raw materials locally through their own manufacturing units.

Sobha Realty, Deyaar projects lure investors to Umm Al Quwain real estate market

Looking ahead, Sobha Realty anticipates sustained demand for their masterplans in Umm Al Quwain. Over the next five years, they plan to begin handing over both their masterplan developments in the emirate.

Beyond Sobha’s projects, other developments gaining traction include Deyaar’s AYA Beachfront Residences and the UAQ Creek Waterfront, which are attracting lifestyle-driven buyers.

For investors considering the market, Cummings advised watching the phased rollout of Downtown UAQ | Sobha Realty, particularly as commercial and hospitality elements become available.

Sobha Siniya Island’s luxury residential offering is also expected to drive interest in the medium term.

“Umm Al Quwain offers a combination of value, scale, and long-term vision. For investors, it represents an opportunity to get in early in a market that is just beginning to define itself,” he concluded.