Over the next three years, the financial free zone DIFC will add about one-third of the city’s office supply; the majority of this space is anticipated to be pre-leased due to the constant demand, it continued.
At 92%, Dubai has the second-highest office occupancy rate in the world, and by the end of 2025, it is predicted to surpass 94%.
Office rentals increased by 22% year over year in 2024, according to Prathyusha Gurrapu, director and head of research and consulting at Cushman & Wakefield Core. Additional increases of 10% to 12% are anticipated in 2025. Due to the expansion of new enterprises and the influx of international corporations into Dubai, the region’s financial, commercial, and tourism center, demand has been exceeding supply.
“We’re seeing an incredible surge in demand for office space in Dubai, with more companies entering the market and existing tenants looking to expand,” said Robert Thomas, Head of Agency at Cushman & Wakefield Core.
“While the supply pipeline is stronger this year, much of it is pre-leased or focused in specific free zones, which is adding to the pressure. Many clients are now taking a strategic approach – maximising the use of their existing spaces or exploring newer zones like Dubai CommerCity and Expo City Dubai to meet their needs,” he said.
Maintaining momentum in 2024
Dubai’s commercial real estate market continued to grow well in 2024, according to real estate firm Savills, with notable expansions seen in the office and industrial sectors.
“Dubai’s office market remained vibrant in 2024, with demand outpacing supply for premium Grade A office spaces. Key business districts such as DIFC, Business Bay, and Downtown reported near-full occupancy, with DIFC reaching 96 per cent by year-end. Emerging areas like Dubai South and Expo City gained traction due to their affordability, reduced traffic congestion, and availability of space,” said Savills.
The Dubai Chamber of Commerce reports that more than 51,000 companies joined.
“With Grade A office spaces witnessing record-low rates in prime districts such as DIFC, and upcoming supply in emerging areas like Dubai South and Expo City, the market is adapting to meet sustained demand. The strong leasing activity driven by the Financial Services and Technology sectors underscores Dubai’s ability to cater to the requirements of international businesses while supporting sustainable development initiatives.,” said Toby Hall, head of commercial agency, Savills Middle East.