What Are the Commercial Trends in Dubai Real Estate Market?

Dubai is the most popular of all the emirates in the United Arab Emirates. And one of the top reasons behind its popularity is its eye-catching infrastructure and architecture following by the great employment opportunity for all people throughout the world. Therefore, the commercial trends in Dubai real estate market is on the boom for the past few decades and every other entrepreneur wishes to buy commercial property in Dubai.

Commercial Trends in Dubai Real Estate Market

Dubai is a famous commercial hub, that attracts many businesses throughout the world. New policies and schemes were introduced in the city to make a favourable work culture for entrepreneurs and business owners to set up in Dubai. If you’re an entrepreneur and willing to set up your business in Dubai but have doubts regarding buying or renting commercial properties in Dubai, then you are at the right place.

Here we have come up with the reports of commercial trends in dubai real estate market. These reports show some of the best commercial property for sale in Dubai. Also, the reports discuss the legacies involved in renting or buying commercial real estate in Dubai. The report states that the ex-pat entrepreneurs with the established business plan should buy commercial property in Dubai especially if they wish to stay more than 10 years in the United Arab Emirates.

The present market situation provides favourable conditions for ex-pat business proprietors to enjoy strong returns on their invested amount in the next 10 years, which they have spent in buying a commercial property today. It also helps remove the price of rent and build opportunities in order to target budgets on ventures that can develop the business.

Charges for Ready-to-Move-in Commercial Property in Dubai

Here is the breakup of the upfront price that business entrepreneurs can expect while buying commercial property in Dubai: The value of the property

• • The transfer charge of 4% to (DLD) Dubai Land Department 
  • 5% of Value Added Tax (VAT)
  • The trustee registration charge is AED 4k + 5% VAT, which comes up to AED 4,200
  • Brokerage cost to the real estate agency

Return of Investment for Commercial Properties in Dubai

The commercial and residential real estate market in Dubai provides all investors with a competitive and strong return on their investment. Therefore, some of the real estate market surveys in Dubai believe that commercial properties in the city will create better ROI for investors in the future years. The better ROIs generally outgrowths from the commercial properties. And this is based on the fact that the tenants at commercial property stay longer at the same address. The reason why commercial tenants stay longer in the same rental building is that they need to customize the area as per the brand requirements which in the end costs higher. 

• Owing to Commercial Properties in Dubai 

According to the Dubai property market law, the freehold commercial space in Dubai must belong to the company’s name. At present, the offshore enterprises listed under the (DMCC) Dubai Multi Commodities Centre or (JAFZA) Jebel Ali Free-zone Authority can officially buy freehold properties in Dubai. Just like this, businesses that are in the free zones of Dubai are also permitted to buy commercial properties in that specific free zone. Buying a commercial space under the name of the company comes with several advantages. It includes securing your invested amount, security, privacy, and complete foreign ownership. 

• Renting Commercial Property in Dubai

Renting commercial spaces in Dubai comes with several legalities and prices. Also, the most important amongst all the legalities is that the commercial property, tenants should create the tenancy contract under Ejari – a government-run program that determines the tenancy contracts in Dubai.

What are the best areas for Commercial Properties in Dubai?

The entrepreneurs and the business owners have a choice to start their company in Dubai be it the mainland or a free zone area. Both the areas only have different ownership rules. 

• Free Zone

Under the free zone area, all the foreign nationals get complete 100% ownership of their business. But they can only run a business and trade along with the companies outside the United Arab Emirates. 

• Mainland

Under the mainland areas of Dubai, the foreign nationals used to have a UAE national in order to act like an owner. The business owners in the mainland own a 51 % share of the total business. Therefore, this provision was altered after the introduction of the complete 100% foreign ownership law back in the year 2018. 

But there comes the law along with the complete ownership in both the areas of Dubai. Yes, after the mainland area of Dubai has restricted the foreign ownership with a selected category of business programs. And for this reason, around 95% of new businesses in Dubai prefer to start a business in a free zone area. Besides the free zone area in Dubai, DMCC which is located in the JLT area is the next best and the most considered area for commercial spaces like workspace, commercial floors, or shops. 

It claims 0% personal tax or commercial income tax and it gives complete foreign ownership through an online platform that comes along with all sorts of required facilities to administer your business. Since JLT consists of a residential area and a free zone, it has become easy for people to live and work in the same community through which they also manage to lower their travel time and commute expenses. The JLT area is feasible to many entrepreneurs as it provides a strategic location because the area is nearby to some other business hubs just as Dubai Internet City and Dubai Media City. Business owners who wish to buy or rent warehouses in Dubai can also look towards Dubai South that is close to Al Maktoum Airport.

The Rise in Commercial Properties in Dubai

Commercial trends in Dubai real estate market show a growing demand for smaller office spaces. Currently, Dubai boasts an impressive 8.7 million sq m of gross leasable area (GLA) for offices. In Q3 of 2019 alone, nearly 80,000 sq m of GLA was added with the completion of key projects like the 4 and 5 buildings in the Mastercard District and Trade Centre District within Dubai Media City. Interestingly, a preference for open floor plans over traditional cubicles is emerging, with most inquiries focusing on units under 1,000 sq m that offer large, collaborative spaces. To cater to this evolving demand, several initiatives have been introduced to boost the Dubai commercial property market.

One of the key trends in Dubai’s commercial real estate market is the government’s push to boost demand. Initiatives like the introduction of the One Free Zone Passport are a prime example. This program allows free zone companies to expand their operations to the Dubai mainland. Free zones like DWTC, DAFZA, DMCC, and DIFC have partnered with the economic development department to offer dual licenses under this scheme. These initiatives are expected to significantly increase demand for workspace across Dubai’s commercial real estate market in the coming years.

Increasing Rate of Hotel in Dubai Real Estate Market

The hospitality sector, a key player in Dubai’s commercial real estate market, witnessed substantial growth in 2019 across all major UAE cities. Back then, Dubai saw a significant addition of 800 keys, bringing the total number of service apartments and hotels to around 124,000. This growth can be partly attributed to relaxed government regulations on short-term rentals, which fueled a surge in demand for holiday homes alongside traditional hotel stays. Capitalizing on this trend, the IBG Group announced their ambitious plan to acquire and manage 10,000 properties to furnish Dubai’s booming market for hotels and holiday rentals.

Apart from this, Emaar has also joined this Dubai real estate market with its very own online platform named “Ease by Emaar”, the purpose of this platform is to allow the buyers of the property to rent it for a short-term period. For this reason, the commercial property for sale in Dubai has reached its peak. 

Conclusion

Dubai is a big and one amongst the popular emirates of the United Arab Emirates. Thus, in the past few years, Dubai has evolved and developed to the next level that has made the city most visited all over the world. And just because of this there started many fairs, festivals, and business-related expositions on the global front. 

Dubai’s commercial real estate market is reaching new heights, fueled by its popularity as a business hub. From towering high-rises to collaborative co-working spaces, entrepreneurs are actively investing in commercial properties to establish themselves in this well-developed and technologically advanced city. This trend reflects a broader shift in the UAE real estate market, where firms are exploring mergers to capitalize on renewed economic growth and investor interest. Developers and construction companies are responding by introducing new, cost-effective commercial products that cater to the current market demands.

Progressing technological advancements just as new coworking spaces are driving the real estate market in terms of space management with real estate assets. And this concept has made it easy to buy commercial property in Dubai. Such concepts help beginners start with small instead of skipping the idea due to the heavy costs of buying their own commercial space.

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