Dubai’s modern infrastructure, including its metro system, contributes to its appeal as a business destination.
Dubai’s thriving economy is driving an unprecedented surge in demand for office space, creating a significant supply-demand imbalance and reshaping the city’s commercial realty landscape. As the emirate attracts businesses from around the globe, businesses are now facing —
- severe competition to secure office spaces in prime locations
- surging rental prices
Dubai’s office market is witnessing high occupancy levels, with city-wide rates peaking at approximately 92% in 2024. Prime areas, like the Dubai International Financial Centre, are nearing full capacity, with occupancy rates close to 100%, underscoring the fierce demand for quality office space in the city’s most sought-after locations.
The surge in demand has significantly increased rental prices across Dubai’s commercial realty sector. In 2024, office rents surged by 22% YoY, with further increases of 10-12% forecasted for 2025.
Premium locations such as DIFC and Downtown Dubai have seen even more dramatic growth, with rental prices soaring by up to 44%. The Trade Center area experienced the most substantial increase, with rents nearly doubling, rising by an astonishing 96%.
The robust demand for office space is driven by —
- Dubai’s impressive economic performance
- its growing appeal as a global business hub
Dubai’s GDP expanded by 3.1% in the first three quarters of 2024 compared to the same period in 2023. This growth is supported by strong performances in key sectors, which have all seen significant expansion, such as —
- transport
- storage
- finance
- construction
The influx of new businesses to Dubai is further exacerbating the office space shortage. In 2023, the Dubai Chamber of Commerce welcomed 67,222 new companies, marking a 26.8% increase in 2022. This surge in new business registrations has led to a demand for new office space, reaching 1.28 million square feet in 2024, a 64% increase from 2023.
The market remains significantly undersupplied despite adding 650,000 square feet of office space in 2024. The shortage is prompting companies to —
- consider emerging business districts such as Expo City and Dubai Production City, which offer modern infrastructure and competitive rental rates
- repurposing residential and retail spaces into offices to meet their needs while maintaining high-quality standards
Dubai’s commercial real estate sector is poised for further growth and transformation. The current supply-demand dynamics present challenges and opportunities for businesses and investors looking to capitalize on Dubai’s economic boom and position as a leading global business hub.
