Dubai office sales hit $762m in Q1 as off-plan transactions surge 741%

The performance marks an 83 per cent year-on-year increase in sales value and a 24 per cent rise in transaction volume, cementing the city’s position as one of the world’s most dynamic business destinations.

While ready office units continue to dominate the sales market, off-plan transaction values rose nearly eight-fold, up 741 per cent to AED800m ($218m), compared to AED100m ($27m) in the same quarter last year.

Dubai office market

Off-plan transactions accounted for 18 per cent of total sales, up from just 8 per cent in Q1 2024.

Vidhi Shah, Director, Head of Commercial Valuation at Cavendish Maxwell, said: “These record-breaking figures speak for themselves. Dubai continues to enhance its position as a global business hub and a magnet for businesses large and small.

£The momentum is real: Q1 2025 saw nearly 40 per cent more foreign company registrations – including multinationals and SMEs – compared to the same time last year, reflecting ever-growing investor confidence and creating unprecedented demand for office space.

“The surge in off-plan deals can be attributed to buyer trust in upcoming developments, competitive launch prices, flexible payment plans and expectations of long-term capital appreciation. With limited existing supply and rising rental costs, a growing number of tenants are opting to buy as a strategic, long-term cost-saving measure.

“Ready offices still account for the majority of sales, but it is clear that off-plan properties are very much in demand, and we expect this trend to continue throughout 2025 and beyond.”

Office sales prices increased by 24.5 per cent year-on-year and by 6.5 per cent quarter-on-quarter, with the average price reaching AED1,650 ($449) per square foot by March 2025.

Rental rates followed a similar trend, rising 24 per cent annually and 6.7 per cent compared to Q4 2024, with average office rents climbing to AED160 ($43.5) per square foot.

Downtown Dubai led the market in annual growth with prices rising by almost 40 per cent, followed closely by DIFC (39 per cent) and Barsha Heights (38 per cent).

Limited availability of Grade A space has pushed prices higher across lower-tier office stock, with demand spilling over into B and C grade inventory.

Business Bay topped the chart for transaction volume in Q1 2025, recording 316 deals, followed by Jumeirah Lakes Towers (222), Motor City (130), Barsha Heights (88), and Dubai Silicon Oasis (41).

In terms of size, offices between 1,000 and 2,000sq ft were the most in demand, accounting for 48 per cent of all sales. Smaller units under 1,000sq ft made up 40 per cent, while only 2 per cent of transactions involved spaces larger than 5,000sq ft.

Dubai’s total office inventory reached 9.3 million square metres of gross leasable area (GLA) as of Q1 2025.

An additional 215,000 sq m is expected to enter the market before the end of the year, with another 181,000 sq m scheduled for delivery in 2026.

Much of the upcoming stock is located in core business districts and classified as Grade A, potentially easing supply constraints over the next two years.

Vidhi Shah added: “Much of the new supply is concentrated in core business districts, with a significant proportion in the A-grade category.

“With a strong development pipeline over the next three years, we expect the current supply-demand imbalance to narrow, bringing some relief to tenants and easing upward pressure on prices.”

This article was originally published in Arabian Business.