https://arab.news/b73s5
- Dubai sales jump 207 percent; Abu Dhabi leasing doubles
RIYADH: Office market activity in the UAE surged in the first half of 2025, with Dubai’s high-value transactions jumping 207 percent and Abu Dhabi’s leasing demand more than doubling, according to Knight Frank.
Dubai recorded 83 office sales worth over 10 million dirhams ($2.7 million) each, up from 27 in the same period last year. In Abu Dhabi, office requirements topped 50,000 sq. meters — a 110 percent year-on-year increase — as corporate expansions drove demand.
Analysts attributed the growth to strong global occupier confidence, buoyed by rising activity in business services, technology, real estate, and consulting, coupled with near-full Grade A occupancy in both cities.
Faisal Durrani, partner – head of research, MENA at Knight Frank, said: “Confidence in Dubai as a global business hub remains exceptionally strong. Indeed, this is reflected in record low vacancy rates for Grade A stock across the city, which stands in sharp contrast to many other global gateway cities.”
He added: “The technology and trading systems sector has emerged as major driver of demand, while sustained activity from financial, real estate and business consulting firms underscores the city’s appeal to a diverse range of global occupiers.”
Dubai leads
Downtown Dubai led the city’s office sales in the first half of 2025, with average prices topping 5,000 dirhams per sq. foot — far ahead of other submarkets.
Business Bay ranked second, breaking the 2,000-dirham mark for the first time after posting 21.2 percent growth since 2020.
Off-plan sales gained traction, particularly in Business Bay, where 1.3 million sq. feet of office space is under development, reflecting strong investor confidence. In leasing, the Dubai International Financial Centre remained the priciest location for fitted offices at 400 dirhams per sq. foot, while Dubai Design District, The Greens, and Business Bay also saw solid rental gains.
Business services drove 38 percent of demand, followed by technology (31 percent), real estate (12 percent), and banking and finance (10 percent). Knight Frank expects 15.8 million sq. feet of new supply by 2030, pushing total stock to nearly 137.8 million sq. feet.
“The confidence in the office sector is further evidenced by the boom in high-value transactions, with the number of office sales over 10 million dirhams setting a record of 83 sales in the first half of 2025,” Durrani added.
Abu Dhabi market
In Abu Dhabi, business services led office demand in the first half of 2025 with a 32 percent share, followed by government entities at 9 percent. Grade-A occupancy hit record highs, driving rents higher in prime locations.
“New rental contracts in Abu Dhabi have been a primary driver of market activity this year, with transaction volumes experiencing a significant peak in January, signaling fresh demand and business expansion in the UAE capital,” said Durrani.
Musaffah recorded the strongest rental growth in the second quarter, up 68 percent, followed by Al Bateen at 64 percent and Al Hisn at 18 percent. Older districts such as Al Danah and Al Nahyan posted slight declines due to a higher share of secondary stock.
The pipeline includes Aldar’s HB Tower on Yas Island (22,171 sq. meters) and the Saas Business Tower on Al Reem Island (12,004 sq. meters), both Grade A developments aimed at meeting evolving occupier needs.