Dubai Office Lease Transactions - Summer 2022 Q2-Q3

Locations in Dubai with higher concentrations of new, or relatively modern, stock have experienced a sharp return to rental growth. Submarkets such as Business Bay, the DIFC and the Dubai Design District have all seen rents surpass pre-COVID levels, while older parts of the city where there is a higher concentration of older, more secondary stock are still struggling to return pre-pandemic lease rates. This is not necessarily due to a lack of demand in the market, but a lack of demand for older offices. The race for quality office supply continues to soar in UAE’s key office districts. This is driven by business sentiment and existing companies looking to expand or move from older buildings to newer ones.

Of the rent transactions that Knight Frank completed during summer 2022, Media One Tower and Thuraya Communications Tower top the list with approximately 26,600 sqft and 25,300 sqft office leased space, respectively. The sectors occupying these spaces include business and professional as well as technology and telecommunication services.

As a hub for worldwide commercial and technological activity, Dubai has become an important destination for global firms. A rise in the number of new license registrations over renewals indicates a high number of new market entrants are eager to enter Dubai, serve a larger market and reach a wider audience. Dubai is home to about one-third of investors and the highest number of venture capitalist in the Middle East and North Africa (MENA) region. It contains an environment with a strong financial infrastructure and supportive entities which is beneficial to aspiring entrepreneurs and start-ups.

For more information, please contact Alaa Aljarousha.