{"id":109146,"date":"2025-11-05T00:00:00","date_gmt":"2025-11-05T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/uae\/office-rents-climb-up-to-35-y-o-y-in-dubai-and-abu-dhabi-in-3q-amid-high-demand\/"},"modified":"2025-11-05T00:00:00","modified_gmt":"2025-11-05T00:00:00","slug":"office-rents-climb-up-to-35-y-o-y-in-dubai-and-abu-dhabi-in-3q-amid-high-demand","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/uae\/2025\/11\/05\/office-rents-climb-up-to-35-y-o-y-in-dubai-and-abu-dhabi-in-3q-amid-high-demand\/","title":{"rendered":"Office rents climb up to 35% y-o-y in Dubai and Abu Dhabi in 3Q amid high demand"},"content":{"rendered":"

The office market remains tight in both Dubai and Abu Dhabi, with both <\/strong>emirates seeing more tenants expand and new entrants in the market hiking demand<\/strong>, according to two separate reports from Savills.<\/p>\n

DUBAI-<\/p>\n

Average rents across Dubai were up 35% y-o-y and 4.5% q-o-q in 3Q 2025 amid tight <\/strong>supply and high demand<\/strong>, defying the usual summer lull, according to Savills\u2019 Dubai Office Market 3Q report (pdf)<\/a>. Prime office rents were up by as much as 35% y-o-y, however five submarkets saw rent stabilization on the back of supply constraints. <\/p>\n

REMEMBER- <\/strong>2Q showed signs of a <\/span>slight cooldown<\/a>, with rents stabilizing in several areas and 11 out of the 23 tracker sub-markets saw rents remain flat q-o-q, despite rising 36% y-o-y.<\/span><\/p>\n

Tenant trends: <\/strong>Leasing enquiries were concentrated in smaller units, with nearly 65% of 3Q enquiries for spaces below 5k sq ft, and just 2% for spaces of over 40k sq ft. Transactions were split equally between new entries, expansions, and relocations, with each accounting for 29% of transactions, while renewals made up just 13%.<\/p>\n

Sector-wise, <\/strong>tech, media, and pharma sectors each accounted for 29% of transactions, with consulting energy and oil firms both making up 14%. Financial and government tenants remained active but constrained by licensing and availability in preferred freezones. Many tenants settled for ready spaces rather than waiting for new completions. <\/p>\n

Areas seeing growth<\/strong> included Old Dubai submarkets which posted q-o-q gains exceeding 10%, while Business Bay, Downtown Dubai, and Sheikh Zayed Road recorded moderate growth.<\/p>\n

Supply and pipeline: <\/strong>Minimal new completions kept market conditions tight. Key launches in 3Q included HQ by Rove in Business Bay and Capital One in Jumeirah Village Circle, and strata office models gained popularity. Roughly 1 mn sq ft of office space is set to come online by early next year \u2014 much of it already pre-leased \u2014 and rental growth is slated to moderate amid global uncertainty. Demand will stay high, however, as companies continue to set up shop in the emirate, with the strata office models and new completions offering some relief.<\/p>\n

ABU DHABI-<\/p>\n

Over in Abu Dhabi, the office market tightened further in 3Q<\/strong> \u2014 driven by limited Grade A supply and steady business expansion, according to Savills\u2019 Abu Dhabi Office Market report (pdf)<\/a>. The emirate saw strong demand and limited availability throughout 1H<\/a>, despite ADGM\u2019s expansion to Al Reem Island.<\/p>\n

Rental rises: <\/strong>Grade A rents reached AED 2.9k on average per sqm in Central Business District (CBD) \u2014 up 15% q-o-q and 35% y-o-y \u2014 while outer CBD rents stood at AED 1.8k per sqm, down 1% q-o-q but still 11% higher y-o-y. Occupancy remained tight across premium submarkets, particularly within ADGM-linked buildings, where fitted plug-and-play space continues to be absorbed within weeks of becoming available. <\/p>\n

Demand was evenly split between expansions and new market entrants in 3Q<\/strong> \u2014 With limited Category A fitted stock, tenants increasingly prioritized immediate availability over full bespoke fit-out, and short search windows pushed more occupiers to compete for ready-to-occupy space. <\/p>\n

Tenants from the financial services, technology and manufacturing sectors led demand<\/strong>, each accounting for an 18% share of total enquiries. The medical and healthcare segment made up 14% of enquiries, transportation came in at 9%, and professional services accounted for 5%.<\/p>\n

The outlook: <\/strong>New Grade A deliveries remain tight through 2026 with larger supply additions not expected until late 2027 or early 2028. Until then, rental growth is likely to remain stable to marginally upward given pre-commitment levels and limited near-term release of prime inventory. Flexible workspace spaces is still an untapped market, especially as foreign firms look for spaces with quick setup times.<\/p>\n","protected":false},"excerpt":{"rendered":"

An influx of new tenants and existing ones looking to expand continued to drive demand<\/p>\n","protected":false},"author":1,"featured_media":109147,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1565],"tags":[1360,87,7,98],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-109146","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate","tag-abu-dhabi","tag-dubai","tag-enterpriseam-uae","tag-real-estate","wpautop","entry"],"acf":{"mongo_id":"b2d5df2a-c606-4a74-8d1e-f71aab567b9a","order":"8","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2025\/11\/301.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Office rents climb up to 35% y-o-y in Dubai and Abu Dhabi in 3Q amid high demand","related_issue":[109132],"teaser":"An influx of new tenants and existing ones looking to expand continued to drive demand","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2025\/11\/.9630eba3-d306-4402-8bd7-7d547a630a8e.mp3"},"yoast_head":"\nOffice rents climb up to 35% y-o-y in Dubai and Abu Dhabi in 3Q amid high demand - 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