UAE Real Estate Market Overview
The report titled “UAE Real Estate Market Outlook to 2025 – By Office Real Estate Market (Premium, Grade A and Grade B); By Retail Real Estate Market (Super-Regional Malls, Regional Malls, Community Centers, Neighborhood Center and Convenience Center); By Residential Real Estate Market (Apartment and Villas) and By Hotel Real Estate Market (1-3 Star, 4 Star, 5 Star and Hotel-Apartments)” provides a comprehensive analysis of the real estate space within UAE. The report covers various aspects including introduction of the UAE real estate market, macroeconomic overview, regional office market coverage (including current and future supply, demand, gap analysis, rental & occupancy rate), regional retail market coverage (including current and future supply, demand, gap analysis, rental as well as occupancy rate), entire UAE & regional residential market coverage (including current and future supply, demand, gap analysis, rental and occupancy rate for apartments and villas), regional hotel market coverage (including number of hotels and keys, RevPAR and Occupancy rate); Snapshots of Northern Emirates (Sharjah, Ajman, Ras Al-Khaimah, Fujairah and Umm Al-Quwain), Snapshot of UAE industrial and co-working market, major growth drivers, issues and challenges, regulatory landscape and competitive landscape. The report concludes with future outlook and analyst recommendations highlighting the major opportunities and cautions.
UAE Real Estate Market Overview
UAE’s real estate market is currently in its mature stage. The period during 2013-2016 was marked by a steady stream of supply, owing to the increasing GDP and increased demand in the market. Heightened rents led to decrease in the demand due to lacking affordability of the citizens and expatriates during 2014-2015. After 2014 oil shock, the government has been actively attracting Foreign Direct Investment and expatriates to the UAE in order to diversify their economy away from oil generated revenues. The UAE Government launched the “Vision 2021”plan, for the economic and social development of the country. From 2017 and onwards, the total number of international players in each respective sub market increased. Newer segments such as townhouses, and co-working spaces, smart and green buildings gained traction in the market.
UAE Residential Real Estate Market
The government started issuing long term residence permits called “Golden Cards” in 2019. This particular scheme aims at providing long term residency for investors and for exceptional workers in the field of health, engineering, science and art. Around 6,800 investors from over 70 countries with investments totaling USD 27 billion were being given permanent residency under this scheme. Among 9.4 million population of UAE, 8.4 million people are a part of expatriate population. Growing population was one of the key drivers which led to increase in demand for residential units in the country.
UAE Retail Real Estate Market
Backed by high number of expatriate population and strong consumer base, retail industry witnessed strong growth in the land of Emirates. Store-based retailing will continue to dominate in the UAE. Increased consumerism has given rise to increased faith of people in buying products and services thereby increasing contribution to the retail sector. Dubai has the highest share of super-regional malls as the retail sector is trying to engage shoppers by offering them more than just a shopping destination. All of these factors have increased the demand for retail space in UAE.
UAE Hotel Real Estate Market
The UAE has long been recognized as a premier tourism and leisure destination. Over the years, tourism sector has experienced sustained growth, becoming a key component of UAE’s economy. Dubai Tourism Strategy 2020 was launched in the year 2013 and is a strategic road map with the key objective of attracting 20 million visitors per year by the year ending 2020. It involves broadening Dubai offerings in terms of events, attractions, infrastructure, services and packages and making it appealing to a wider audience. Increase in the number of tourist attractions has been elevating the demand for hotel units and hotel space within UAE.
UAE Office Real Estate Market
UAE’s office market is a thriving space with the presence of both domestic and foreign brands, offering office spaces in categories such as Premium, Grade A, and Grade B. In May 2019, the UAE government announced that it would soon be possible for foreign entrepreneurs to hold 100% shareholding in a locally incorporated business, therefore, driving the office space in the country. Total foreign ownership was previously only permitted in the UAE’s free zones, meaning businesses incorporated ‘onshore’ had to be 51% locally owned. These factors point towards the scope and profitability of the office market in UAE in the near future.
Snapshot on UAE Co-Working Real Estate Market
Approximately 7 million people are predicted to be working in co-working spaces (For instance, Regus and We Work and Others) within UAE in 2019. Based on the global growth that took place in co-working spaces, it is anticipated that UAE will experience steady growth in co-working space in the upcoming years. Approximately, half of the blue-chip companies will have some sort of shared office space by end of 2020. Majority of co-working space providers intends to either enter into a partnership or have lease agreement with the landlords.