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UAE Real Estate Market Review Q4 2025

Real estate markets sustain ascent, despite slight softening of macro landscape

February 3, 2026 10 Minute Read

The UAE’s non-oil economy continues to grow strongly, as reflected by the 4.8% sector expansion, amidst a growing reputation as a global hub for innovation, with Dubai now ranked the world’s third most startup-friendly city.
Acute supply shortages are defining the office market as occupancy rates reach 95% in Dubai and 98% in Abu Dhabi, driving annual rental growth of 18% and 12%, respectively, across the two commercial hubs.
Dubai’s residential sector may be transitioning toward a period of moderation and quarterly rental stabilization in some locations, while Abu Dhabi continues to see record activity, highlighted by a 50% annual surge in transaction volumes and a dominant off-plan segment.
National hospitality performance remains strong with average occupancy rates of over 80%,with RevPAR climbing over 14% during the same period, fueled by Abu Dhabi’s ultra-luxury pivot, Ras Al Khaimah’s burgeoning MICE and wedding segments, and sustained demand for Dubai’s premium beachfront resorts.
The retail landscape remains a landlord’s market in prime destination malls, with occupancy levels reaching 98% in Dubai and 95% in Abu Dhabi, supported by steady tourism inflows and population expansion.
Industrial and logistics rents rose 13% annually in Dubai due to a persistent undersupply of high-spec warehousing, though relief is expected starting in mid-2026 as major new facilities from Terralogix and Aldar edge towards completion.

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