The UAE’s property market is booming in 2025 — and it’s not just about off-plan homes anymore. From offices and warehouses to malls and hotels, nearly every real estate sector is seeing major growth.
Commercial Office Space in High Demand
According to JLL’s Q1 2025 Market Dynamics report, office vacancy rates have dropped to historic lows — 8.6% in Dubai and just 2.3% in Abu Dhabi. Prime office areas in Dubai are nearly full, with a 0.2% vacancy rate, while Grade A offices in Abu Dhabi are also nearly maxed out.
Despite a dip in annual leasing activity, Dubai saw a 9.3% rebound in Q1 compared to the previous quarter. Developers are actively launching premium towers and upgrading older assets to meet demand, fueled by relaxed visa and business setup reforms.
Residential Sector Remains a Powerhouse
Dubai’s residential real estate recorded Dh115.6 billion in sales in Q1 2025, with off-plan properties making up over two-thirds of transactions. May alone saw Dh66.8 billion in residential sales from 18,700 deals — a 44% increase compared to May 2024.
Primary ready sales surged 314% year-on-year, while secondary ready homes rose 21% in value. High rents are prompting many tenants to renew leases, though upcoming new supply may ease price pressures.
Industrial & Warehousing Sees Double-Digit Rent Growth
Warehouse rents jumped by 10.9% in Abu Dhabi and 12.5% in Dubai. Demand is strong in locations like KEZAD and Al Quoz, thanks to strategic infrastructure. Abu Dhabi’s plan to boost manufacturing by 2031 is also driving up renewals and leasing activity.
Retail Space Rebounds Across the Board
Retail is on the rise, especially in prime zones. Dubai’s premium malls recorded a 29.5% increase in rents, hitting Dh826 per sq. ft. Super-regional and regional malls saw 9% growth. In Abu Dhabi, prime retail space rents reached Dh5,524 per sq. m. Community malls also experienced modest growth, supported by high renewal rates.
Hospitality Sector Thriving on Tourism Surge
Dubai hosted 5.31 million overnight guests in Q1 2025 — a 2.5% annual rise. Hotels maintained 82.2% occupancy, with ADR at Dh841 and RevPAR at Dh691. Abu Dhabi’s ADR rose 28.1% year-on-year to Dh757, with RevPAR at Dh606. Dubai is set to add 4,700 new hotel rooms by year-end, primarily in the luxury segment.
The Outlook
From residential units to commercial towers, industrial hubs, malls, and resorts — UAE real estate is thriving in 2025. Robust investor confidence, favorable policies, and a demand for quality spaces are powering the market forward. Whether you’re investing, relocating, or expanding your business, this could be the ideal time to explore opportunities across the UAE’s diverse real estate landscape.
Source: Gulf News
