Dubai Office Rents Surge 45% Amid Soaring Demand for Premium Spaces

Dubai’s office market continues to demonstrate robust growth, marked by rising rental prices, low vacancy rates, and heightened demand for premium commercial spaces. According to the latest market update from Dubai Office, the first quarter of 2025 saw average office rents climb by 45% compared to the same period last year.

Key business districts such as DIFC, Business Bay, Downtown Dubai, and TECOM are leading the surge, emerging as the most sought-after locations. Notably, DIFC has achieved a remarkable 98% occupancy rate, underscoring the demand for top-tier office environments.

This upward trend is fueled by increasing employment and strong business confidence, with effective employment expenses rising by 4.9% in Q1 2025, as highlighted in the Savills Global Cost Benchmark Report.

Toby Hall, Head of Commercial Agency at Savills Middle East, noted:

“This growth reflects confidence in Dubai’s long-term positioning. Companies are viewing Dubai not just as a regional hub, but as a global center for innovation, finance, and enterprise. The increase in rents and operating costs highlights the demand for quality and the limited supply of high-end space.”

Core sectors such as finance, consulting, technology, and media remain the primary drivers of demand, making up over half of Savills' transactions during the quarter. Simultaneously, smaller, more agile companies are becoming increasingly active in emerging sub-markets like Dubai South and Expo City, where affordability and connectivity offer greater value.

The Dubai Chamber of Commerce reported onboarding 70,500 new companies in 2024, a 4.6% year-on-year increase, indicating growing investor and corporate confidence in Dubai’s economic landscape.

As more companies seek flexible, high-quality workspaces, demand for serviced offices is on the rise. These providers are expanding into mixed-use, community-oriented developments to meet evolving occupier expectations.

With limited Grade A supply in established districts, landlords are adapting by offering personalized leasing terms, upgraded facilities, and refurbishment projects. In Business Bay, some strata landlords are now commanding rents comparable to DIFC, reflecting the rising perceived value across various submarkets.

Lease renewals remain a preferred option for many firms, particularly outside DIFC, where RERA regulations offer added rental protection amid rising costs. Meanwhile, tenants are increasingly prioritizing adaptable layouts and functional design over expansive floor space or lavish specifications.

Despite constrained availability, new office developments are in the pipeline, reinforcing long-term confidence in the market. The competition for quality space is expected to intensify further throughout 2025.

Hall concluded:

“Dubai’s office market is not tightening but evolving. The data reflects growing maturity, where rental increases are driven by sustained demand, strong fundamentals, and a global reorientation toward Dubai as a long-term base for enterprise.”