The past year has dramatically changed the commercial real estate market in Dubai. Since January 2025, our team at 20-88 Real Estate has been actively developing this area, and in just one month of work, we have encountered remarkable features of the local market that are rarely discussed in the public domain. It’s time to share an insider’s perspective on how this segment operates from within. That’s why we have prepared a detailed publication and an in-depth video on our channel.
Dubai paradox
Few places in the world intertwine business opportunities and challenges as closely as Dubai. The city attracts entrepreneurs with its tax incentives and the stability of the local currency – the dirham has been pegged to the dollar for more than three decades. However, each advantage comes with specific nuances that must be considered when choosing commercial real estate.
Take the Creek Harbour neighborhood, which I have written about multiple times on my Telegram channel. Here, the cost of commercial premises has doubled in recent years. But this growth is not a speculative bubble – it is a natural result of rising demand. The market is experiencing a unique situation: with 180,000 residential units under construction, only 3,500 commercial spaces are planned. This imbalance creates immense pressure on the market.
The intricacies of finding the perfect space
In Dubai, searching for commercial real estate resembles a complex chess game – every move requires meticulous analysis. From our experience, even with an extensive database of properties and well-established contacts, it takes at least a month and a half to find a suitable space, and that’s in an ideal scenario.
A recent case perfectly illustrates the complexity of the process. A client found what seemed to be the perfect office in a prestigious neighborhood – spacious premises, modern finishes, reasonable price. However, a detailed analysis revealed a major drawback: only three parking spaces for 65 employees. From October to April, this might be a minor inconvenience, but during the five months of summer heat, it becomes a critical issue. Such details can completely overshadow all the advantages of a location.
Real examples from our practice and hidden aspects of approvals
Dubai’s bureaucratic system is uniquely meticulous. Every aspect of a commercial space requires separate approvals. Even installing essential appliances can turn into a week-long quest for permits. And if the premises are specialized – such as medical centers, restaurants, or beauty salons – the approval process can stretch over several months.
A typical example is opening a branch of an existing business. Many entrepreneurs are unaware that in Dubai, opening a second office is not a straightforward process – it must be officially registered as a branch of the main company. This entails additional government fees, which are rarely mentioned upfront.
Recently, we worked with a medical center located in the five-star Fairmont Hotel on Sheikh Zayed Road. This project exemplifies what a properly selected commercial property in Dubai should look like. It includes everything – from state-of-the-art medical equipment to an advanced air-conditioning system. The annual rent is AED 450,000 – a figure that may seem high but is entirely justified by the location and business potential. The return on investment is significantly higher.
Another case involved securing office space in Opus Tower. The search process took nearly two months, but the result exceeded expectations. The key factor was not just the prestigious location but also the practical advantages: convenient parking, proximity to restaurants for business meetings, and excellent transport accessibility. Such details are critical for long-term business success.
Financial features of the market
Dubai’s rental payment system differs drastically from the monthly payments that many entrepreneurs are used to. Here, it is standard practice to issue post-dated checks for a quarter, six months, or even a year in advance. At the same time, operating costs are significantly higher than in other major metropolitan areas.
Expenses include not only the base rent but also additional costs such as utility bills, building maintenance, and insurance. For medical facilities and restaurants, special licenses and permits add another layer of expenses, sometimes reaching substantial amounts. However, with the right approach to selecting a property, the potential profits fully justify these costs.
Specifics of different types of premises
Each type of business in Dubai requires a tailored approach when selecting commercial space. For restaurants, foot traffic and the ability to install proper ventilation are critical. Medical centers need special permits and must comply with stringent regulations. Office spaces should accommodate not only the company’s current needs but also future expansion potential.
The free zone system deserves special attention. DMCC, DIFC, Dubai South – each zone has its own specific rules and restrictions. Choosing the wrong zone can lead to the need for relocation within six months when additional business licenses become necessary but are available only in a particular free zone.
Practical advice
Dubai continues to grow rapidly, directly impacting the commercial real estate market. New districts emerge, tenant preferences evolve, and space requirements shift. A successful investment today is not just about selecting square meters at an attractive price – it’s a complex decision that involves dozens of factors, from neighborhood development prospects to the nuances of local regulations.
From personal experience, I can say that when choosing commercial real estate in Dubai, it is crucial to:
- Carefully analyze transportation accessibility, not only on weekends but also during peak hours
- Verify all necessary permits and assess business development opportunities in the selected location
- Account for specific fees and additional costs
- Calculate all technical requirements for the premises in advance
- Evaluate the district’s prospects for the next 3–5 years, as entrepreneurship is always about strategy and long-term planning
We have prepared a detailed video on our YouTube channel, where we analyze each of these aspects in depth. The video includes an exclusive tour of actual properties, interviews with market experts, and numerous practical tips to help you avoid common mistakes when choosing commercial real estate in Dubai. We strongly recommend watching it before making a decision to buy or rent – this knowledge can save you considerable time and money.
