24,000 new firms registered in the first half, the areas with the best office rents revealed.
Rent for Class A offices in Dubai increased by an average of 25%, in one district by 44%.
According to Savills Dubai Office Market Q3 2024 report, Dubai's commercial office market is reaching new heights and unprecedented demand is driving occupancy and rental growth in top business districts.
With a significant increase in new company registrations and expansive activities by existing firms, including those from the financial and technology sectors, the city's real estate environment is more competitive than ever before, putting Dubai in the position of a top global business destination.
According to the report, more than 24,000 new businesses were registered in the first half of 2024, an increase of 5% year-on-year.
Office space rentals in Dubai
The sharp increase underscores the strong economic momentum underpinned by the Dubai Economic Programme (D33) and underlines the emirate's reputation as a hub for international trade and innovation.
Key business areas such as DIFC, Downtown and Business Bay now boast occupancy rates between 95 and 97 per cent, reflecting strong demand for high-quality office space.
The average Class A rental value increased by 25% year-over-year, with increases of 44% and 36% respectively in specific locations such as Business Bay and Downtown.
The most prominent properties in DIFC are leading the market, reporting rent increases of up to 25 percent, while new projects such as DIFC Square and Immersive Tower are set to deliver more than 10 million square feet of premium office space by 2028.
Toby Hall, head of commercial agency Savills Middle East, said: “DIFC DIFC is located at the heart of DIFC: “The growth of Dubai's office space market underlines its appeal as a global business hub, underpinned by ease of establishment, favourable tax conditions and strategic location.
“Businesses are establishing or expanding their presence here, recognizing the value of high-quality office space that supports talent attraction and growth. This demand signals the further development of the market in the coming years. “
Paula Walshe, director of transaction services at Savills Middle East, said: “More than half of office space is currently on the market for office space: “Unprecedented rent increases and high occupancy rates illustrate Dubai's position as a leading destination for global firms to expand.
“We are seeing strong interest from international companies, particularly from the finance and technology sectors, who are prioritising flexible office space to meet their ambitious growth targets and deliver on Dubai's strategic vision. “
In addition, the rise of hybrid work models has led to a growing demand for flexible workspaces, with companies opting for open space layouts and co-working solutions such as Executive Centres and Cloud Spaces.
These spaces are particularly attractive for start-ups and new entrants looking for flexible lease terms and quick setup of operations.
Demand for office space is concentrated in areas with prime supply, however, even more affordable options are seeing significant increases in rents, as seen in Dubai Science Park and Dubai Investments Park, which have seen a 37% year-on-year increase.
Expo City is proving to be a competitive option, offering high-quality venues with strong transport links at a lower cost than the central business district.
The report anticipates that this demand will continue throughout the year as more and more businesses are settling in Dubai, taking advantage of its strategic location, favorable business environment and high-quality infrastructure.
Source: Arabic Business
