The commercial real estate sector in Dubai is reaching new heights, with high-end space especially in demand as businesses seek to stand out from the crowd and woo employees back with a workplace environment worthy of the daily commute.
Emirates REIT (CEIC) PLC, the largest Shariah-compliant Real Estate Investment Trust’s (REIT) in the world, which is managed by Equitativa (Dubai) Limited, has first-hand experience of this trend. Emirates REIT is seeing robust demand for commercial space at its flagship Index Tower in Dubai International Financial Centre. Occupancy at the impressive 80-storey building, which was designed by Foster & Partners, continued to increase in 2023, to reach 82 per cent in the third quarter of the year. At the same time, rents also increased significantly.
“There is an interesting dynamic in the market, with strong demand for higher-end commercial leasing,” said Thierry Delvaux, CEO, Equitativa (Dubai) Limited. “A year ago, the market was driven more by companies seeking to take on or expand their office space – but with an eye on costs. Now we see greater optimism – and more focus on the value that businesses can gain by investing in a higher-class office: An impressive place to invite clients for meetings, closer proximity to major regional and international companies, and a happier and more motivated workforce.”
Delvaux added that commercial tenants at Index Tower value being in an iconic, recognisable tower, that can be accessed easily by car, taxi or metro. Since Dubai’s white-collar workers have returned to the office in earnest, Delvaux said that companies are more likely to put a premium on ease-of-access for their employees.
“Employers want their staff to spend more time in the office because they see the value of collaboration and teambuilding that comes with people working in the same space, but they also understand that their employees don’t want to spend 30-minutes trying to access parking or walking a long distance from the nearest metro station,” Delvaux added. “And when they reach the office, they value being in a space that is good for their well-being and makes them feel motivated. It might be difficult to measure, but these non-tangibles pay off very quickly for employers.”