• City-wide residential sales prices also witnessed a steady 9% year-on-year increase
  • Off-plan market continues to dominate transactions but a growing shift to ready properties is being witnessed
  • Over 2,400 units handed over YTD 2024 with another 1,950 anticipated over the remainder of the year
  • Office occupancy rates for Prime & Grade A spaces are at a record high of over 90%, reflecting robust demand
  • City-wide office rents increased 15% y-o-y as demand continues to outstrip supply

Abu Dhabi, UAE – The latest Cushman & Wakefield Core’s Abu Dhabi Market Update YTD 2024 reveals steady growth and resilience in Abu Dhabi’s residential and office markets underpinned by strong demand, increased capital values, rents, and record occupancy levels.

RESIDENTIAL MARKET HIGHLIGHTS

Residential Supply

Yas Island and Al Reem Island are witnessing the major share of new residential handovers

Year to date 2024, a total of 2,431 units have been handed over, including 1,315 apartments in Al Raha Beach, Al Maryah Island, and Masdar City, as well as 1,116 villas in Jubail Island, Yas Island, and Saadiyat Reserve. An additional 1,950 units are anticipated for handover later this year, bringing the total for 2024 to approximately 4,300 units, with the majority of upcoming deliveries expected in Reem Island and Yas Island.

Residential Transaction Trends 

Prathyusha Gurrapu, Head of Research and Consultancy at Cushman & Wakefield Core says, “Although off-plan transactions still make up a significant portion of total volumes, we have seen a growing shift toward existing properties in YTD 2024. Ready property transactions increased by 54% compared to the same period in 2023, reflecting a growing share of end-user buyers seeking ready-to-move-in homes.

On the other hand, off-plan sales transactions saw a decrease of 19% YTD 2024 compared to the same period in 2023. This is due to limited launches of new projects and lower launch volumes.

City-wide sales prices displayed a steady year-on-year growth.

City-wide villa prices have seen a notable 10% increase year-on-year, driven by strong demand in luxury areas such as Saadiyat Beach Villas (+11%) and Yas Acres (+7%). City-wide apartment prices also rose by 8%, with prime districts witnessing significantly higher increases as Saadiyat Island leads the market with a 30% price increase, followed by Yas Island (+17%) and Reem Island (+9%).

City-wide rents are rising at a faster rate than sales prices, leading to a compression in yields.

Prathyusha adds “Abu Dhabi has witnessed the sharpest annual increase in rents in the last decade. The rental market in Abu Dhabi saw strong growth in rents with villas rising to 10% and apartments to 16% as compared to the previous year.”

Villas in Saadiyat Island had a significant rental increase of 14% followed by Yas Acres with 13% and Al Reef Villas with an 8% rise. In the apartment districts we track, Yas Island witnessed the highest increase of 15% in rental prices followed by Saadiyat Island at 14% and Reem Island at 12% increases. Areas like Yas Island are becoming more desirable for tenants, driving rental increases, while established luxury communities like Saadiyat Island are leading rental market growth.

OFFICE MARKET HIGHLIGHTS

David Short, Head of Abu Dhabi at Cushman & Wakefield Core says “The market is experiencing a clear mismatch between supply and demand, especially in the Prime and Grade A segments. With limited availability, prime office spaces are achieving exceptional performance, with occupancy rates nearing 95%.

Office Supply

Abu Dhabi’s office market is currently at 4.05 million sq. m. of total stock. Prominent recent completions, such as the Al Maryah Tower (34,000 sq. m. of Grade A space), are helping meet demand, but the market remains very competitive. Looking ahead, SAAS Business Tower on Reem Island, slated for completion in Q1 2025, will provide an additional 12,000 sq. m. of Grade A office stock.

Office Demand

David Short says “Abu Dhabi has seen a significant diversification in demand in the last few years, with new entrants stemming from the financial sector, particularly those requiring ADGM licenses, in areas like Al Maryah and Reem Island.”

The Banking and Financial sectors remain dominant, contributing to 27% of overall demand, followed by the Oil and Gas sector at 21%. Sectors such as healthcare, Artificial Intelligence, government, security, and defence are also witnessing significant growth in demand.

David Short adds “There is a growing trend of tenants upsizing and relocating due to limited expansion space in existing buildings, though consolidation activities remain minimal. Government and semi-government entities continue to show steady demand, particularly for Grade A offices, where fitted spaces are preferred. The demand for flexible working environments in serviced offices is accelerating, with current operators expanding their footprint and new players absorbing large spaces as confidence in the market grows.”

Growth in Office Rents

Prime office spaces in Abu Dhabi have experienced a consistent rise in rental rates with city-wide office rents witnessing a 15% y-o-y increase, coupled with occupancy levels reaching between 90% and 95%. Abu Dhabi Global Market (ADGM) has been a primary driver of this upward trend.

Grade A office properties have mirrored this pattern, with strong absorption in key mainland areas such as Al Raha and Capital Centre. Prime office rents range between AED 1,950 and AED 2,600 per sq. m. annually, reflecting strong demand. Grade A office rents have risen to AED 1,600–1,900 per sq. m. annually, with occupancy rates continuing to climb.

-Ends-

For further information or media queries, please contact:
Prathyusha Gurrapu, Director - Head of Research & Consulting, prathyusha.gurrapu@cushwake.ae
Fiona Johnston, Associate Director – Marketing, fiona.johnston@cushwake.ae

About Cushman & Wakefield

Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in nearly 400 offices and 60 countries. In 2023, the firm reported revenue of $9.5 billion across its core services of property, facilities and project management, leasing, capital markets, and valuation and other services. It also receives numerous industry and business accolades for its award-winning culture and commitment to Diversity, Equity and Inclusion (DEI), sustainability and more. An independently owned and operated affiliate of Cushman & Wakefield, operating in the UAE since 2008. For additional information, visit www.cushwake.ae.