New report by consultancy firm Core Savills revealed all the indicators of the Dubai office rental market’s uptick in for the third quarter. Even central Dubai areas and big-spaced offices witnessed growth in Q3 after several months of downturn or stability.
Dubai office rental market is actually developing apart from the other sectors. Supply and demand balance here is different and in contrast to the residential real estate market the demand and prices for offices in Dubai kept growing almost all year in 2016, for this gateway city is increasingly becoming favorable for international occupiers as a convenient logistics hub and commercial platform with tax-exempt policy. But in some areas average office rentals just remained flat throughout the year, while some experts consider these averages to be a touch-stone for the entire real estate market future revival. First, office rentals in these areas should start to bottom out, and then the residential sector will follow, experts believe.
According to the report, this has already happened. Despite a more pronounced interest to smaller offices in free zones such as DIFC and Tecom, grade A buildings in JLT and Downtown too have finally seen a 5 percent increase in the upper rental range, and that was after a sharp drop in prices during the previous quarters.
However, renting out offices in areas like Dubai International Financial Centre (DIFC) can still bring their owners an average of 15-20 per cent more yields than the same-sized offices in other Dubai areas. And still, the most traditional Dubai business district Business Bay is on top: rental prices here stayed stable, and among tenants there are not only large corporations, but also small and medium-sized businesses (SMEs), especially start-ups.
Core Savills CEO, David Godchaux also noted, that “Dubai offers strikingly lower overall lease acquisition costs for both financial corporations as well as creative/SME firms when compared to other global cities.”
It is expected that the Dubai office stock will expand by 269,000 and 368,000 square meters of office leasable space in 2016 and 2017, respectively, and IMEX Real Estate will help you navigate in this ocean of office rental offers and make the right choice. Entrust your decision to professionals!