Dubai commercial property sales soar nearly 80% as market braces for shake-up

Dubai’s commercial real estate sector recorded a sharp rise in sales during 2025, with industry analysts predicting the emergence of a two-tier office market as new Grade A developments begin to reshape pricing and tenant demand later in the decade.

According to market data, commercial property sales value climbed by 77.9 per cent year on year in the first 11 months of 2025, reaching AED15.5 billion, while transaction volumes rose by 35.1 per cent to 5,364 deals. The growth comes amid broader strength in Dubai’s real estate market, which has already posted record results in the residential sector this year.

Despite the strong performance, market participants say Dubai’s office sector is approaching a period of structural change. Firas Al Msaddi, chief executive of fäm Properties, said the commercial market has lagged behind residential real estate in adopting modern design and construction standards.

“Since 2008, Dubai has not seen a real new generation of office buildings,” Al Msaddi said.

“In contrast, the residential market went through a major transformation, new design language, new architecture, new luxury standards, and new construction codes.”

He added that the first wave of next-generation Grade A offices is expected to be delivered from 2028 onwards, marking a turning point for the sector.

“That will be the moment of truth, as we see how secondary offices perform when tenants finally have modern, efficient, architecturally relevant options,” he said.

“The gap between old and new will widen, and the entire commercial sector will reprice itself around quality, creating a two-tier office market, with older buildings facing pressure as new Grade A properties command premium pricing.”

Commercial sales surge in 2025

Office assets accounted for the largest share of commercial activity during the period, with AED11.2 billion in sales across 4,012 transactions. Retail units followed with AED3.8 billion in sales from 1,321 deals, while smaller volumes were recorded in showrooms, warehouses, workshops and specialist properties such as clinics and gyms.

Al Msaddi highlighted Vision Tower in Business Bay as an example of sustained demand for high-quality office space. “It has consistently outperformed the market because it attracts real, established corporates,” he said.

“The smallest unit is a half-floor, which naturally filters for serious companies, and the performance of that building tells you exactly how strong true Grade A demand really is.”

The commercial surge comes alongside a record-breaking year for Dubai’s residential sector, which saw 197,263 transactions worth AED624.1 billion, surpassing full-year results from 2024 with a month still remaining.

Market observers say continued economic growth, rising business activity and limited supply of modern offices are supporting near-term demand, while the arrival of new developments later this decade is expected to redefine how commercial property is valued across the emirate.