The year gone by will be remembered as the first since 2008 in which all the major sectors of the real estate market in Dubai and Abu Dhabi were in growth mode. Within this general trend, there are of course many different sub-stories, with different sectors at quite different stages of their cycles.

During the first-half of the year, the residential sector continued to show strong growth. However, the market witnessed a welcome cooling since around the midyear. Villa prices in Dubai rose by just 3 per cent and apartment prices by a mere 1 per cent in the third quarter. And in the fourth quarter, there has been some evidence of prices and rents beginning to fall. This cooling is a reflection of regulatory changes designed to reduce price pressures and the unwinding of some of the previous exuberance in the price expectations of sellers.

As we turn to 2015, the Dubai residential market is expected to remain relatively subdued, although not unhealthily so. This stability is to be welcomed as it will allow the city to regain some of the competitiveness which it lost as a result of unsustainable growth in prices over the past two years. The Abu Dhabi market appears to have more growth left in it and likely to see prices increase more quickly.

Abu Dhabi also saw a relatively stronger performance in the hotel and office sectors in 2014. For the first time, hotel occupancies in Abu Dhabi exceeded those in Dubai during July 2014, although the latter continued to experience much higher levels of room rate and, therefore, revPAR (revenue per average room).

In the year to August, the Dubai market recorded occupancy rates of 78 per cent (relatively flat compared to 2013), while occupancies in Abu Dhabi rose from 64 per cent in 2013 to 71 per cent. Attractive room rates have helped in Abu Dhabi, with the daily average rate in the year to August being little more than half of that in Dubai (at $133 compared to $238).

Investors are recognising that there is relatively little short-term upside in the residential market and therefore switching their attention to other sectors, while others are looking for opportunities overseas (particularly in the UK and North America). Respondents to JLL’s ‘MENA Investor Sentiment Survey’ expect the hospitality, office and industrial sectors to be the best performing in the UAE in 2015, with stronger interest also being expressed in the residential and industrial markets in Saudi Arabia.

Two other major themes characterised the UAE real estate market in 2014 — a large number of new project announcements and a wider variety of funding models.

A number of high-profile projects were announced in Dubai over recent months (including the world’s largest retail centre (Mall of the World), three theme parks by Meraas (Legoland, Bollywood and Motiongate) and numerous residential launches by Emaar (e.g., Boulevard Heights), Damac (Oxygen) and others.

These projects will have to compete for buyers’ attention with a number of ‘previous generation projects’ relaunched recently, such as the Dubai Lagoons (now known as Dubai Creek Harbour) and the Dubai Canal project.

On the funding side, developers have become less reliant on pre-sales than in the previous boom. While there continues to be a steady stream of off-plan launches, most of these have been relatively moderate in scale and restricted to a small number of top-tier developers.

While some local banks remain cautious, given their legacy over exposure to the real estate sector, the financial position of most developers has improved as they have managed to reduce their debt exposure during 2014.

The major news on the funding side has been the launch of Emaar Malls as a separate company, which listed on the Dubai Financial Market in October. There was strong investor appetite, with the private and institutional investor order books being 20x and 30x oversubscribed. There are a number of other major UAE developers that may follow Emaar’s lead and pursue an IPO or other equity raisings in 2015.

The big unknown for 2015, however, is the impact that lower oil prices could have on real estate markets. Until now, the authorities have expressed the view that their strategic plans remain unaffected, but if prices continue to fall, or look likely to remain low for an extended period, that could lead to changes.

The writer is the CEO of JLL MENA.