Rent associated with Dubai office property increases 25%

Rent associated with Dubai office property increases 25%

Prime office rents in central Dubai increased 25% during the 12 months to the end of September, a new report has revealed.

Summary:

  • Dubai office rents have increased by 25% over the past 12 months
  • Residential property in Dubai was found to have appreciated by over 20% earlier this year
  • Widespread property investment has commenced since the World Expo 2020 bid win

Many Dubai property asset classes are generating much higher returns than other countries around the world.

Earlier this year, Knight Frank revealed that residential property in Dubai had appreciated by well over 20% – around 10 percentage points more than any other nation in the world.

Now, property broker Cluttons has revealed that prime office rents in central Dubai surged 25% during the year-long period to the end of September. There is large demand for property from banks, developers and airlines and consequently grade A office rents rose 8.7% from the second quarter and now average 250 AED per sq ft.

The Cluttons report states Dubai’s core business district – the DIFC, Downtown Dubai and Sheikh Zayed Road – still houses the most expensive offices in the emirate.

“Following the usual summer slowdown, the market has regained its strength, with strong demand persisting for well-located space,” said Steve Morgan, Chief Executive of Cluttons Middle East.

“Across the business sectors, the office market remains very active in all segments. We have been recording a steady rise in take-up by both existing and new occupiers, with the banking and financial services, real estate and aviation sectors being among the most notable,” he added.

Property investment in Dubai has been widespread since the emirate won the bid to host the six-month-long World Expo 2020. The event is set to generate widespread economic growth in the whole region and offer investors the potential for the kind of returns they have already been seeing well into the future.

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