MODEST NEW SUPPLY AND RISING RENTS FUEL GROWTH
Just 90,000 sqm, barely 2% of stock was handed over in 2025 and another 73,500 sqm is expected to be completed in 2026, limiting any upward drift in vacancy. Q4 2025 saw the completion of The Link in Masdar City and Masdar City Square already pre-let for Q1 2026. Other prominent handovers expected in 2026 are M-19D and Souk Al Jubail. Although Mubadala and Aldar have announced an AED 60+ billion ADGM expansion, new supply is unlikely to materialise until after 2030, suggesting continued near-term tightness.
DEMAND ANCHORED BY FINANCE AND ENERGY SECTORS
The Abu Dhabi office market continues to demonstrate strong momentum, supported by robust demand, tightening vacancies, and broad-based sectoral expansion. By the end of Q4 2025, Prime and Grade A office spaces reached 98.5% occupancy, up from 94% in Q4 2024, reflecting the sustained scarcity of institutional-grade supply. Demand continues to be led by the financial sector, particularly global and regional institutions expanding within ADGM, which maintains the highest occupancy levels in the capital. Public sector entities, business services firms, and flexible space operators are also driving sustained demand as they expand operations and upgrade to newer, higher specification stock.
RENTS AND OCCUPANCY LEVELS TO REMAIN ELEVATED
In the near term, Abu Dhabi’s office market is expected to remain landlord-favourable, supported by limited new supply, strong institutional demand, and continued expansion across the energy and financial sectors. While diversification into emerging office hubs such as Masdar City and Yas Island may gradually ease pressure on core locations, Grade A availability within prime submarkets remains constrained, sustaining competition for high-quality space. We have also seen a wider adoption of flex space options as the market tightens This dynamic is unlikely to shift meaningfully until 2029 to 2030, when the majority of the announced Grade A pipeline is scheduled for delivery.
