Dubai, United Arab Emirates – CBRE Middle East, a leading authority in global commercial real estate services, has released its Q2 2025 UAE Real Estate Market Review, showcasing the continued strength and resilience of the country’s real estate sector.
The UAE’s economy is on a robust growth trajectory, with GDP forecasted to rise by 5.1% in 2025, compared to 3.8% in 2024. Key contributors include a recovery in oil output, strategic trade initiatives, booming tourism — marked by a 7% year-on-year increase in international visitors to Dubai from January to May — and increased investment in advanced technologies. While geopolitical tensions remain a risk, the UAE’s market fundamentals continue to support confidence and growth.
In a bid to promote homeownership and stimulate end-user demand, Dubai launched a First-Time Home Buyer Program, offering attractive incentives such as flexible payment plans and preferential pricing.
Office Market: Rising Demand Amid Limited Supply
Demand for office space in Dubai remains robust, especially from the Banking, Finance, and Technology sectors. However, supply is constrained, leading to a significant rise in rental rates — over 20% year-on-year. Similarly, Abu Dhabi’s office market is thriving, buoyed by new international entrants, near-full occupancy, and growing rental levels — all indicators of healthy market activity.
Residential Market: Expansion and Diversification
Dubai’s residential sector posted continued growth in Q2 2025, with average property values increasing by almost 14% annually. While certain communities are showing signs of stabilization, premium areas continue to see substantial appreciation, reflecting an evolving, segmented market. In Abu Dhabi, average apartment values jumped 18% year-on-year, while villa prices rose nearly 14%.
The first half of 2025 also saw a sharp rise in Dubai’s residential transactions, which surged 23% year-on-year, bolstered by strong off-plan sales. The total value of residential deals reached AED 270 billion. The UAE is also expected to attract a record number of millionaire migrants this year, further fueling demand for luxury and off-plan properties.
Hospitality & Retail: Strong and Steady Growth
Tourism continues to play a pivotal role in economic diversification, with the sector projected to contribute AED 267.5 billion to the UAE’s GDP in 2025. Dubai leads the charge with rising visitor numbers and improved hotel metrics. The retail sector is similarly thriving, with strong consumer demand and increasing rents. New entrants such as Primark, along with lifestyle and entertainment brands like BrewDog and Kapitol, reflect a vibrant and evolving market landscape.
Industrial Market: Resilient and Investor-Focused
The UAE’s industrial sector remains a stronghold for growth and investment. With high occupancy rates, strong rental gains, and rising interest from global investors, the market favors landlords and points to continued expansion. The logistics and manufacturing sectors, in particular, are showing signs of increased liquidity and development opportunities in Grade A industrial assets.
Matthew Green, Head of Research & Consulting, MENA at CBRE, commented:
“The diversity and adaptability of the UAE’s economy — combined with forward-looking policy initiatives — continue to underpin the strength of the real estate sector. We foresee continued momentum across various asset classes throughout the year, particularly as the UAE attracts growing numbers of high-net-worth individuals.”
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE: CBRE) is a Fortune 500 and S&P 500 company headquartered in Dallas, Texas, and the world’s largest commercial real estate services and investment firm based on 2024 revenue. With over 140,000 employees (including Turner & Townsend), CBRE operates in more than 100 countries, offering a comprehensive suite of integrated services including facilities, property and project management, valuation, leasing, investment management, and strategic consulting.s.
