In the first half of the year, 24,000 new companies were registered, and the best office rental areas were identified.

Gen Z Driving a Shift in Dubai’s Real Estate Market
Trends such as sustainable lifestyles and the integration of smart technologies into homes are gaining popularity among the new generation of buyers. The residential market in Dubai is undergoing a fundamental shift, with Generation Z set to soon become the majority of buyers, according to industry experts. Developers are now adapting concepts and designs for new projects to meet the preferences of these younger buyers.

Younger Buyers Taking Over the Market
“Dubai’s housing market is experiencing a significant demographic shift in terms of buyers, as the average age of buyers continues to decrease,” said Ankur Aggarwal, Chairman and Founder of BNW Developments, in an interview with Arabian Business.

• Millennials (born in the ’80s and ’90s) currently dominate the market.
• Generation Z (born in the late ’90s) will soon become the main group of buyers.

Aggarwal emphasized that this represents a fundamental change compared to the previous decade, when the average age of buyers in Dubai and the UAE was significantly higher.

Why Gen Z Prefers Homeownership in Dubai
According to Farooq Syed, CEO of Springfield Properties, the arrival of Generation Z as homeowners is reshaping Dubai’s real estate market. The main reasons why Gen Z invests in property include:

• Rising rental costs
• Flexible working conditions
• Dubai’s role as a global hub for talent, innovation, and a high standard of living

Other industry players confirm the growing interest of young investors in booking properties in upcoming developments.

Economic and Financial Factors Driving Young Buyers
Experts attribute Generation Z’s growing investments in real estate to the following factors:

• Economic diversification and GDP growth
• Government support for attracting global talent
• Low interest rates and easy installment plans from developers

These factors enable and motivate younger buyers to enter the market, stimulating demand across different real estate segments.

Smart Homes and Innovation: Gen Z’s Impact on Real Estate
Generation Z is driving innovation in Dubai’s real estate market. Development projects are now incorporating:

• Smart homes with AI automation
• Energy-efficient systems
• Advanced security features
• IoT-connected devices

“Smart technology is becoming a standard part of modern projects, reflecting the values and preferences of Generation Z,” Aggarwal stated.
As Gen Z’s demand grows, Dubai’s real estate market continues to expand and mature, as reflected by recent data.

Growing Interest in Neighborhoods Outside City Centers
Industry experts highlight increasing confidence in Dubai’s real estate market beyond the city center, especially as younger buyers enter the market.

• In 2024, investor interest has shifted toward emerging neighborhoods away from central areas.
• Dubai South and Jumeirah Village Circle (JVC) are gaining popularity among young buyers.

Data from Q3 2024 indicates that the more affordable housing segment grew by up to 12% during this period.
“This trend complements established areas such as Dubai Marina, Business Bay, and Dubai Silicon Oasis,” Aggarwal noted. Still, Downtown Dubai and Dubai Marina remain key investment destinations.

Dubai’s Office Market Reaches New Heights
According to the Savills Dubai Office Market Q3 2024 report, Dubai’s commercial office market is achieving new heights, driven by unprecedented demand for prime business districts.
With a surge in new company registrations and the expansion of existing firms—particularly in finance and technology—Dubai’s real estate environment is more competitive than ever, cementing its position as a top-tier global business destination.
Over 24,000 new businesses were registered in the first half of 2024, marking a 5% year-on-year increase.

Office Rents in Dubai
This rapid growth underscores Dubai’s strong economic momentum, fueled by the Dubai Economic Agenda (D33) and the emirate’s reputation as a hub for global trade and innovation.
Key business districts such as DIFC, Downtown, and Business Bay now boast occupancy rates between 95% and 97%, reflecting the strong demand for premium office spaces.

• The average Class A office rent increased by 25% year-on-year.
• Business Bay and Downtown experienced rent surges of 44% and 36%, respectively.

Top-tier DIFC properties recorded rental growth of up to 25%, while new developments such as DIFC Square and Immersive Tower are set to deliver over 10 million sq. ft of premium office space by 2028.

Dubai as a Global Business Hub
Toby Hall, Head of Commercial Agency at Savills Middle East, stated:
“Dubai’s office market growth highlights its attractiveness as a global business hub, supported by easy business setup, favorable tax conditions, and a strategic location. Businesses recognize the value of high-quality office spaces for attracting talent and fostering growth. This demand signals further market evolution in the coming years.”

The Rise of Flexible Workspaces
Paula Walshe, Director of Transaction Services at Savills Middle East, added:
“The unprecedented surge in rents and high occupancy rates solidify Dubai’s position as a top destination for global business expansion. We are witnessing growing interest from international firms, particularly in finance and technology, who prioritize flexible office spaces to meet their ambitious growth targets.”

Moreover, the rise of hybrid work models has increased demand for co-working spaces, with companies choosing open-plan layouts and flexible solutions like those offered by Executive Centre and Cloud Spaces.
These flexible spaces are especially appealing to startups and new businesses, offering adaptable lease terms and rapid setup.

While demand remains high for premium office districts, more affordable options are also seeing sharp rental increases. Dubai Science Park and Dubai Investments Park reported a 37% year-on-year growth.
Expo City is emerging as a competitive alternative, offering high-quality office spaces with excellent transport links at lower costs than the central business districts.

Future Outlook
The report predicts continued demand throughout the year, as more businesses establish operations in Dubai, leveraging its strategic location, business-friendly environment, and world-class infrastructure.

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Source: Arabian Business