Commercial property investors spent $1.8 billion in the United Arab Emirates (UAE) in 2013, marking a rise of 97 per cent from the previous year, ft.com reports.
The growth comes as the region continues to recover from a severe three-year dip. According to property firm Savills, property values and office rents fell drastically between 2008 and 2011, causing almost 50 per cent of all construction projects to be cancelled or paused.
As a result of last year’s surge, average property yields dropped by 37 basis points from 2012, although they remain ahead of the previous low. Experts believe this could signal future growth.
Dubai is at the centre of the UAE’s rise, with its upcoming World Expo 2020 event driving interest in the region as a whole. According to gulfnews.com, average commercial yields in the city are now at five per cent, which still puts it ahead of Munich (4.5 per cent) and Frankfurt (4.7 per cent) in terms of financial appeal.
Savills’ global research director, Yolande Barnes, said: “Dubai is clearly flexing its muscles as the real business and investment hub of the Middle East. Price rises in the city are a clear reflection of asset price inflation in the recent past.”
Adding to this, Fadi Mousalli from property firm Jones Lang LaSalle claimed that while other areas of the UAE are showing positive movement, cities like Doha and Abu Dhabi are still trailing Dubai in terms of optimism and growth.
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