PC: Construction Business News Middle East
Resilient Market Defies Global Challenges
The UAE’s real estate market is anticipated to sustain its growth curve in 2024 based on the strong growth pattern observed in 2023, even in the face of a difficult global economic situation. According to experts from JLL at the event “Navigating the Growth Spectrum: Exploring Strategies for Sustained Success” in Dubai, robust economic fundamentals, strategic government initiatives, and increasing investor confidence drive growth across the UAE’s diverse property sectors.
While the rest of the world is grappling with rising inflation and interest rates, the UAE and the rest of the GCC have so far demonstrated great resilience. Private and sovereign wealth in the region has been quite robust, coupled with more spending on infrastructure, helping it insulate itself against the global economic headwinds. According to James Allan, CEO for JLL’s Middle East and Africa region, “Despite global uncertainties, the UAE real estate market remains robust, buoyed by government-led initiatives and growing investor trust.
Residential Market: Affordable Housing in Focus In Dubai, off-plan luxury property launches have been the highlight, but demand is moving towards residential units priced below AED 3 million. This trend is creating opportunities for developers to cater to the growing need for affordable housing options. Around 34,000 residential units are expected to be delivered in 2024.
Residential transactions will continue to have a slowing pace of growth but demand for branded residences, wellness-oriented properties, and co-living spaces would continue to grow, more in tune with changing lifestyles.
Commercial Real Estate: Taut Supply Presses Rents Up Tight supply continues to drive demand for the UAE’s high-quality offices. This has resulted in increasing rents, and such a scenario is sure to remain a landlord’s market.
Despite the adoption of hybrid working models, the demand for flexible office spaces has grown, particularly in business districts like Downtown Dubai and Abu Dhabi’s Central Business District.
Logistics and Industrial Growth
The logistics and industrial sectors are on course for further growth, with the UAE retaining its leadership in the GCC. The country ranks 7th globally on the Logistics Performance Index, with initiatives such as Operation 300 Billion and the UAE Industrial Strategy 2030. Growing demand for logistics and warehousing solutions from e-commerce and third-party logistics (3PL) companies supports this growth.
Retail and Hospitality: Changing to Meet Demand
Retail spaces in the UAE are turning into community centers. There is a focus on including fitness facilities, clinics, and co-working spaces in retail spaces as more and more consumers look for convenience and technology. Luxury brands continue to grow in Dubai, while Abu Dhabi consolidates its position as a family and cultural entertainment destination.
In hospitality, a robust tourism pipeline and an extensive events calendar drive sector growth. Dubai’s global status as a tourist hub attracts both leisure and business travelers, fueling strong performance in hotels and related assets.
Optimism for 2024
JLL experts are optimistic about the prospects of UAE real estate, citing its strategic role as a regional financial and business hub. The resilience, adaptability, and forward-looking approach by the UAE’s property market position it for sustained success in the coming year.
