Key Points :
Strong Market Performance: The UAE real estate market is witnessing robust growth across all segments despite global economic challenges, indicating resilience and strength in the sector.
Retail Growth: Retail sector growth was evident with over 6,000 new contracts in Dubai in Q3 2022 and a robust pipeline of retail spaces, fueled by the rise of online shopping and retailers enhancing their digital footprint.
Policy Reforms Driving Market: Recent policy reforms, such as the abolishment of the AED 1 million minimum down payment rule for Golden Visas, are expected to attract a wider range of investors and increase demand for premium real estate offerings.
Sustainability Initiatives: Developers like ZāZEN Properties are setting benchmarks in sustainability, aligning with national initiatives such as UAE Net Zero 2050 and the Dubai 2040 Urban Master Plan, highlighting a commitment to sustainable development.
Origin Private Office’s Strategic Entry into the UAE’s Booming Real Estate Market UAE Real Estate Market Flourishing Amid Global Challenges
The real estate sector in the United Arab Emirates (UAE) is experiencing a surge in momentum, drawing substantial interest from both local and international investors. Despite prevailing global economic challenges, the sector demonstrates remarkable strength and resilience, showcasing robust performance across residential, commercial, retail, and hospitality segments.
Recent data unveils impressive growth within the UAE real estate market. Notably, Dubai’s residential sector has witnessed a notable uptick, with transaction volumes escalating by 51% between January and November 2022. Concurrently, the total value of transactions surged by 55% over the same period. This surge is largely attributed to heightened foreign demand for property in Dubai, perceived as a safe haven amidst escalating global geopolitical and economic uncertainties. Noteworthy is the delivery of 38,000 residential units in Dubai in 2022, further bolstering the total supply to 680,000 units. Similarly, Abu Dhabi saw the delivery of 6,000 new units, elevating its total stock to 279,000 units.
The office space segment experienced a significant turnaround in 2022, evidenced by a 21% annual growth in rents for Grade A offices in Dubai’s Central Business District (CBD), reaching AED 2,100 per square meter per annum. Abu Dhabi also witnessed an 8% annual rise in Grade A rents, averaging AED 1,790 per square meter per annum. This surge can be attributed to robust business conditions and limited prime office space stock, resulting in increased rental values and reduced vacancy rates, standing at 11% in Dubai and 23% in Abu Dhabi.
The hospitality sector witnessed a remarkable rebound, with average occupancy levels reaching 72% in Dubai and 69% in Abu Dhabi during the initial 11 months of 2022. This resurgence is credited to major events such as the FIFA World Cup in Qatar and the Abu Dhabi F1 Grand Prix, driving hotel occupancy to record levels by year-end.
Retail also experienced notable growth, marked by over 6,000 new contracts in Q3 2022 in Dubai, alongside a robust pipeline of retail spaces. The proliferation of online shopping has prompted retailers to enhance their digital presence, further bolstering revenues in a fiercely competitive landscape.
In the midst of this burgeoning landscape, Origin Private Office has expressed its intent to make a substantial impact on the UAE real estate sector. Origin’s strategic entry aims to capitalize on burgeoning market opportunities, with a particular focus on luxury residential and commercial developments. The firm seeks to leverage the UAE’s favorable economic policies, exceptional infrastructure, and global connectivity to establish a strong foothold in the market.
Recent policy reforms, including the abolishment of the AED 1 million minimum down payment rule for obtaining a Golden Visa through real estate investment, are poised to provide a further boost to the market. These reforms are anticipated to attract a broader spectrum of investors and elevate demand for premium real estate offerings.
Sustainability emerges as another focal point, with developers like ZāZEN Properties spearheading initiatives to set benchmarks in this realm. Projects like ZāZEN Gardens in Al Furjan aspire to attain LEED Gold certification, aligning with national initiatives such as UAE Net Zero 2050 and the Dubai 2040 Urban Master Plan, underscoring a commitment to sustainable development.
The UAE real estate industry’s flourishing trajectory across all segments underscores its attractiveness to potential investors. Origin Private Office’s keen interest in the market signifies a positive outlook for both the real estate sector and prospective investors, instilling confidence in the region’s real estate landscape. With strategic policy reforms and a steadfast commitment to sustainability, the UAE is poised to continue its growth trajectory, poised to attract global investments in real estate.
