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The commercial real estate sector is perhaps more closely connected to the most fundamental needs and behaviors of the general public than the other investment sectors. It generally exists to provide service to the society and the economy. The growth of commercial real estate goes in line with the changes and growth in demographics, economy, technology, globalization and other trends in the market.
Dubai remains one of the world’s strongest performing commercial real estate markets. Commercial realty is expected to thrive in line with the influx of people from other parts of the world. The demand for commercial properties and office spaces in the emirate has grown considerably since the beginning of the current year, thanks to the increased confidence in the economy. The hotel, retail and industrial segments continue to experience growth; however, the corporate real estate sector remains extremely selective.
For developers who are only in the traditional residential sector, this is the time to diversify their business strategies, eyeing on mixed-use. Many developers, who made huge profits by building tall residential buildings and selling them out quickly, are now increasingly showing interest in the commercial property sector.
Dubai has been witnessing an upswing in the real estate sector boosted by proposed infrastructure projects and improvements in the existing infrastructure facilities. Developers are coming up with higher grade commercial properties to cater to the rising demand of customers.
The market witnessed a low absorption during the global financial recession primarily in the commercial office market. Currently, there is a large pipeline of new commercial property supply. Prime locations now witness an appreciation in capital values for both commercial and residential units due to demand from both investors and end-users.
The city will continue to attract investments from several industries due to its strategic location and business-friendly atmosphere.
* The demand for office space in Dubai has grown considerably
* Prime locations witness demand from investors and end-users
* Commercial realty growth is dependent on a number of factors
Source: Yash Shah, Special to Properties
The writer is Property Sales & Leasing Manager, SPF Realty