Limited supply, robust infrastructure development, and growing demand for alternative assets like data centers and logistics hubs are propelling the UAE’s real estate sector in 2025, according to JLL’s Middle East and Africa Market Outlook. The UAE dominated 2024 project awards, securing 45% ($40.6 billion), with a strong focus on residential ($28.3B) and mixed-use ($4.6B) developments.

Amid easing global economic challenges, the UAE was the only GCC nation to record oil-GDP growth in 2024, while non-oil GDP surged 4.7%—expected to rise to 4.8% in 2025. This economic resilience, supported by stabilizing inflation and a robust labor market, is fueling real estate demand in both Dubai and Abu Dhabi.

Tender price inflation averaged 3% in 2024, with JLL forecasting 2.5% in 2025, aided by falling interest rates and stabilizing commodity prices, despite industry capacity constraints.

Dubai’s Real Estate Boom Residential sales reached AED 367 billion in 2024, up 32%, with 157,000 units launched—an all-time high. Off-plan sales led with AED 223 billion (60.7%). Rents grew 15.7% but are stabilizing. Office supply will grow by 122,000 sq. m. in 2025, focused on Grade A spaces in top areas like DIFC and Sheikh Zayed Road.

Abu Dhabi’s Market Momentum Office demand surged, with 47,615 leases in 2024—up 30.8%. Limited new supply (172,940 sq. m.) will likely push rents higher in 2025, especially for premium spaces. Hotel occupancy hit 79% in 2024, driven by 4.8M visitors, boosting ADR to $166 (+14.1%) and RevPAR to $131 (+24.3%).

Retail and Logistics Growth Dubai’s retail rents jumped 13.6% in prime malls, with 100,000 sq. m. of new space due in 2025. Industrial lease rates rose 12.1% in 2024, with demand expanding to Abu Dhabi and Northern Emirates.

Data Centers Surge with AI and 5G The UAE leads MEA’s data center market, with Dubai and Abu Dhabi comprising 40.8% of IT load. Growth is fueled by tech adoption, subsea cabling, and investor interest, with MEA market CAGR forecasted at 9.5%-11.7% through 2029.