Dubai property investors turn to smaller offices as sales value slumps

By Zawya

By Staff Writer

Dubai's commercial property sales value fell sharply in the third quarter of 2026 as investors shifted toward smaller office units, according to brokerage firm CRC Property.

Office transactions rose 11.7% from the second quarter to 1,123 units, but their combined value dropped 42% to AED 4.35 billion ($1.18 billion). The average deal size fell to AED 3.87 million from AED 7.46 million.

Overall commercial property sales value declined 25.6% quarter-on-quarter to AED 18.04 billion ($4.91 billion), while transaction volumes slipped 1.8% to 2,789 deals.

“Q3 was a quarter of stabilisation rather than recovery,” said Behnam Bargh, managing director of CRC Property. “Deal counts held firm, but the mix shifted toward smaller transactions.”

Jebel Ali overtakes Business Bay

Downtown Jebel Ali overtook Business Bay as Dubai's busiest office market, accounting for 321 transactions, or 28.6% of the third-quarter total. Jumeirah Lakes Towers recorded 162 deals, up 47.3% from the second quarter.

Office sales value remained 40.4% higher than in the third quarter of 2025, despite the latest quarterly decline. Secondary office prices fell 1.2% to AED 1,930 per square foot, compared with a 3.4% drop in the second quarter.

Emaar Square office sale

Emaar Square Building 3 in Downtown Dubai sold for AED 725 million ($197 million), at a net initial yield of about 8%, providing a reference point for valuations of income-producing office properties.

The previous owners recorded a 44% gross capital gain over a 21-month holding period, illustrating the difference between individual large transactions and the broader shift toward smaller office deals.

Commercial land sales

Commercial land transactions totalled AED 6.81 billion ($1.85 billion) in the third quarter, accounting for about 38% of Dubai's commercial property sales value, as investors sought industrial sites amid limited new land allocations.

(Writing by Mily Chakrabarty; Editing by Seban Scaria)

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