Commercial rents in Abu Dhabi and Dubai fall back to pre-covid rates

Office rents in Abu Dhabi and Dubai have started to come back to pre-COVID-19 levels as the demand for premium space increases.

Commercial rents in Abu Dhabi and Dubai have started to come back to pre-COVID-19 levels as the demand for premium space increases.

As per the global real estate consultancy Knight Frank’s analysis released on Monday, 18 April, 5 of 27 locations in Dubai have witnessed office rents returning to pre-covid prices. While in Abu Dhabi, the best buildings are still showing rental stability.

Advertisement

The partner and head of Middle East research at Knight Frank, Faisal Durrani, “Despite the quieter ending to 2021, early data from Q1 suggests a rebound in demand in Dubai, due to technology businesses extending their footprints, albeit many are start-ups.”

“To an extent, the growth by this group of occupiers is being deteriorated by several businesses that are still reassessing their occupational plans, many of whom are shrinking their office footprints as a result of the growth in hybrid working models, which appear to be acquiring a sense of permanency, especially amongst international blue-chip and professional services businesses, and a handful of international banks,” he further added.

But, Knight franks still points towards a lack of new prime stock, maintaining upward pressure on rents in good buildings in some areas.

“There is a minimal supply pipeline of high-quality office stock in Dubai, where the concentration of businesses remains centred. The effect of this market paradox is upward pressure on rents, or at worst, stability in lease rates among the city’s best buildings, while some of the older, the more secondary stock is beginning to undergo a migration of businesses to better quality buildings,” explained Andrew Love, head of Middle East Capital Markets and Knight Frank, Occupier Services & Commercial Agency.

Business Bay is leading the comeback in office rents, where average rents have risen from Dh76 per square foot in Q1 2020 to Dh101 psf (per square foot).

Whereas in Abu Dhabi, office rents in all of the main submarkets tracked by Knight Frank have stayed stable during Q1. Every year, the Corniche Area resumes pulling away from the rest of the pack, with moderate rents climbing by 7.2% over the last 12 months, taking them to Dh1,675 psm.

Advertisement
Tariq Saeed

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Read More

Dubai: Hemaya Schools celebrates UAE 51st National Day

The General Department of Logistic Support at Dubai Police, in collaboration and cooperation with Hemaya Schools, organised a special event to celebrate the UAE's 51st National Day, which falls on the 2nd of December 2022.

Daily Vlogger and cyclist Hels on Wheels explores Al Ain; shares experience

Daily vlogger and blogger, popularly known as ‘Hels on Wheels’ across social media platforms, is a full-time Global Hobo cyclist who travels the world on her cycle and shares her experience through photos and youtube vlogs.

UAE: Abu Dhabi Police participates in 32nd Abu Dhabi International Book Fair 2023

The Abu Dhabi Police General Command has participated in the opening activities of the 32nd session of the Abu Dhabi International Book Fair 2023, which is scheduled to be held at the Abu Dhabi National Exhibition Centre from 22nd to 28th May.

Recent

Air India boosted Dubai to Delhi flights amid rising demand from passengers

India's flagship carrier Air India has increased its capacity in Dubai, United Arab Emirates, announced the airline on Thursday, June 30.

Jennifer Aniston talks about her relationship with ex Brad Pitt!

Jennifer Aniston has made news quite many times for her relationships and other rumors related to her marriage and pregnancy. But recently, Aniston addressed...

Dubai set to launch world’s fastest roller coaster with 679-metre track

Dubai's Storm Coaster is now officially the fastest of its kind in the world.
admin