Will Dubai Residential REIT's IPO be the next big draw for new investors to DFM?

Dubai: As the first Dubai IPO of 2025 gets rolling, more investors – and especially non-UAE ones – are ready to sign up to trade on the Dubai Financial Market (DFM).

Dubai Holding is putting up its substantial residential portfolio through the REIT (real estate investment trust) IPO, it is a chance for newer investors – and for existing investors to keep cashing in. Because the Dubai Residential REIT IPO offers the best of both worlds:

* Access to another of Dubai’s bluest of blue-chip entities; and

* Another chance for investors to ride the Dubai property market wave. (Even one that’s showing signs of growth rates stabilizing at elevated levels.)

“Investors are getting a win-win with the latest pure-play real estate IPO,” said an analyst. “In much the same way the previous such one – from Tecom Group – did.”  

According to Samer Deghaili, Co-head of Investment Banking for MENAT markets at HSBC, "IPOs have been enjoying strong, often record-breaking demand bringing in local, regional and international investors.

"Structural developments, such as the introduction of stabilisation mechanisms and an increasing awareness from issuers of the dynamics between IPO valuations and aftermarket performance are key to continued success.”

Going by the sign ups during the first three months of 2025, a lot of them have already done so. In Q1-2025, there were 19,366 new investors, of whom a staggering 86% were foreign nationals.

“Over the past three years, Dubai has witnessed an influx of foreign investors from across the investment spectrum opening offices in the emirate,” says a new report issued by HSBC on Dubai’s capital markets growth.

Foreign investors, in fact, accounted for half of all trading on the DFM at the end of 2024.

“The number of total market investors registered on DFM has now surpassed 1.2 million,” says the HSBC report.

“Some 138,262 investors registered with the exchange in 2024 and more remarkably, 85% of these were foreign, demonstrating the appetite and focus Dubai has from the global investor community. This followed an inflow of 62,676 the previous year when 73% of registrants were foreign.

“In 2022, the equivalent number was 167,332.”

To keep investors coming in for more, this is where offerings such as the Dubai Residential REIT’s come in handy. Because as has been clear from the listings made since April 2022, starting with DEWA, Dubai Government backed privatization moves have clicked big-time with investors.

“We believe the combination of a healthy IPO pipeline with growth in secondary market offerings will help to continue enhancing DFM’s liquidity,” said Nabeel AlBloushi, Head of Markets and Securities Services for the MENAT markets at HSBC.

“A strong share price performance in the months and years post-IPO opens the door for selling shareholders to monetise additional shares, boosting liquidity and free float.”