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At the background of uncertainty prevailing in the oil market in recent months, a number of companies wishing to place an office in the UAE capital Abu Dhabi, has become noticeably less, but in the short term the demand for office spaces in the capital will increase, the leading analytical agency Knight Frank says in its latest report.
Knight Frank experts called the constant decrease in number of options available to rent in office real estate segment the main reason for the future increase in demand and, accordingly, a new round of rental price rises in the second half of this year. New real estate supply in the UAE capital Abu Dhabi is actually deficient, and it is felt by all segments of the real estate market.
The greatest demand in the first half of the year, according to Knight Frank, was recorded for small offices with the space of 200 to 500 square meters (50% of requests), and the main industries that provided the most of demand was the financial sector (22% of requests) and the hospitality sector (15% of requests ). The proportion of tenants coming from the construction sector also increased due to the increased activity in the construction of the new municipal infrastructure in Abu Dhabi.
Currently, rentals for premium office spaces, usually fitted with a complete set of all necessary equipment and furniture, in Abu Dhabi reach the maximum of US $ 515 per square meter, and quality, but just shell and core Grade A offices in the city center can be rented for US $ 380 per square meter area.
Matthew Dadd, an expert on commercial leasing in Knight Frank real estate agency, noted that the office property market in Abu Dhabi is quite passive in the sense of the construction of new facilities of the necessary quality, so in the near future the demand is expected to increase in this sector leading, consequently, to this type of property rent price rise.
