Ultra-net-worth, high-net-worth individuals fuel UAE’s strong investment activity

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Bas Kooijman

The UAE’s position as the world’s top wealth magnet is being reinforced by increased investments on the Dubai Financial Market (DFM) which attracted 72,583 new investors in H1 2024; with 85% coming from abroad.

Bas Kooijman, CEO and Asset Manager of DHF Capital explains the dynamics resulting in rising trading activity, higher trade values, and an influx of new investors.

Through the first six months of the calendar year, DFM’s total consolidated revenue grew by 40% to AED305.7 million ($83.23 million), up from AED218.1 million in the same period of 2023; the revenue split entailed AED154 million from operating income and AED151.7 million from investment returns and other income.

Foreign investors

While foreign investors comprised a large portion of this uptick, investment activity within the UAE is also on the rise as high-net-worth individuals (HNWIs) and ultra-high-net-worth individuals (UHNWIs) continue migrating to the country at a record pace.

Koojiman explained: “Dubai now houses more than three million residents, a 1.43% rise from last year. Recent forecasts indicate this figure will exceed five million by 2030. This population growth is attributable to the UAE’s world-class positioning across several industries as we have witnessed growing interest in portfolio diversification from regional investors.

“Global investors, especially those with ample assets, are eyeing the nation’s starring cosmopolitan city as a strategic vehicle to grow their wealth via DFM and other outlets. Many of them are also migrating to the emirate to capitalise on Dubai’s ROI potential as it remains highly appealing versus most if not all other cities across the globe.”

Investment opportunities

The country continues offering various attractive investment opportunities from technology to real estate and finance, among other sectors. According to recent insights, Dubai’s property market reached new levels in July 2024, as sales totalling AED49.6 billion reflected 31.63% growth from the same time last year. Off-plan sales continued to display dominance, accounting for approximately 67% of the total value and 66% of the volume of these transactions. Furthermore, 10% of sales were for properties priced at AED5 million or above, demonstrating a growing appetite for investment from HNWI investors.

As it relates to finance and technology, these sectors are intersecting with an intentional agenda that fuses innovation and digital transformation. The UAE’s digital investment market is projected to reach AED16.1 billion in 2024; total transaction values are expected to grow annually by 3.61% resulting in a projected total amount of AED18.6 billion by 2028.

Significant investments in these areas align with key UAE mandates such as Dubai’s Smart City initiative. Such efforts are positioning the country as a leader in technological advancements by drawing in skilled technology businesses and investors that are inclusive of HNWIs, according to Bas.

Koojiman is facilitating portfolio diversification for several investors, HNWIs, and UHNWIs in the country and abroad. Those who have worked with him since his fund strategy’s inception five years ago have witnessed a minimum average ROI of 110%, more than doubling their initial investment, with the conservative low-volatility fund returning 60 consecutive months of positive returns.