Business | Property
Commercial rents rise threefold in two years
Dubai's commercial property sector witnessed major growth in office rents in the past few years, driven by demand generated by the high influx of multinational companies setting up operations and growth in existing businesses, leading property consultancy Asteco said.
- Staff Report
- Published: 23:03 October 15, 2007
Dubai: Dubai's commercial property sector witnessed major growth in office rents in the past few years, driven by demand generated by the high influx of multinational companies setting up operations and growth in existing businesses, leading property consultancy Asteco said.
Rental rates in Dubai have tripled and on average have risen to a whopping Dh270-Dh280 per square foot in 2007 from Dh90-Dh100 in 2005.
"We expect commercial office rents to remain high in 2007 and 2008 mainly due to construction delays. However, by 2009, a significant amount of new supply will reach the market which will ease rental increases," said John Allen, Director Research Valuation and Consultancy at Asteco.
According to Asteco, rents on Shaikh Zayed Road have jumped to Dh350-Dh375 per square foot compared to Dh220-Dh240 in 2006. Other areas commanding high rental rates include Bur Dubai and Karama at Dh280 and Dh265 per square foot. which have shown a 24 per cent and 51 per cent rise over 2006 third quarter rates respectively.
Apartment rents in Dubai have increased by a significant 25 per cent from 2005 to 2006 and by 18 per cent from 2006 to 2007.
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