Dubai’s commercial real estate sector is poised for significant growth, with its office market set to expand by 415,000 square meters (sqm) by the end of 2026, according to a report by Cavendish Maxwell. This expansion will elevate the city’s total office inventory to 9.7 million sqm, up from the current 6.26 million sqm, as developers prioritize A-grade office spaces to meet demand from multinational corporations, startups, and SMEs.
Breakdown of Growth
The influx includes 185,000 sqm in 2025 and 230,000 sqm in 2026, with premium developments dominating the pipeline. This aligns with Dubai’s broader economic agenda to solidify its position as a global business hub, supported by the following factors —
- pro-business policies
- tax incentives
- infrastructure upgrades
Key areas like Business Bay, Downtown Dubai, and DIFC remain focal points, with Business Bay alone accounting for 46% of total office transactions in 2024.
Rental and Sales Surge
The market has seen record-breaking activity, with office sales values soaring to AED 6.8 billion in 2024 — a 36% annual increase. Rental prices surged by 25% year-on-year, driven by occupancy rates exceeding 92%, with prime locations like Downtown Dubai and DIFC witnessing jumps of 42% and 38%, respectively. Analysts attribute this growth to Dubai’s stable macroeconomic environment and rising foreign investment, particularly in sectors like finance (22% demand) and business services (45%).
Balancing Supply and Demand
While the supply pipeline is robust, experts caution that high occupancy rates and pre-leasing trends could sustain upward pressure on rents until 2027–2028. Emerging districts like Expo City Dubai and Dubai South are gaining traction as cost-effective alternatives, offering —
- flexible office solutions
- modern amenities
Additionally, off-plan sales rose 37% in 2024, reflecting investor confidence in long-term growth.
Future Position
The Dubai office market remains a magnet for global firms, with over 24,000 new businesses registered in H1 2024 alone. As the city enhances its free zone offerings and infrastructure, demand for prime office space is expected to remain resilient. However, stakeholders must monitor how the incoming supply impacts vacancy rates and absorption dynamics in the coming years.
For investors, the next two years present strategic opportunities in high-growth areas, particularly A-grade assets, as Dubai cements its status as a leading destination for corporate expansion.
