SUPPLY: Demand continues to outpace supply with limited handovers expected in 2025
With occupancy levels at an all-time high and a pronounced supply crunch, particularly in Grade A assets, the supply-demand imbalance remains. In 2025, key anticipated completions include Masdar City Square and The Link in Masdar City, as well as Yas Place on Yas Island. While no new stock was handed over in Q1 2025, secondary space has become available in Omega Tower. Looking ahead, the SAAS Business Tower on Reem Island is slated for completion in Q2 2025, introducing 129,168 sqft of Grade A office space.
DEMAND: Key demand drivers - Banking, Financial, Oil & Gas Sectors Dominate
Office occupancy across Abu Dhabi remains healthy at 90%, underpinned by strong performance in Grade A stock, which leads at 96%. ADGM continues to outperform, recording the highest occupancy levels in the capital, driven by sustained demand from global and regional financial institutions. Abu Dhabi’s occupier base has broadened in recent years, reflecting increased sectoral diversification. While Banking and Financial Services remain the primary demand drivers—contributing 27% of total take-up—demand from the Oil and Gas sector remains resilient at 21%, supported by ongoing energy sector investments and national strategy alignment. This shift signals growing depth in occupier demand beyond traditional sectors.
PRICING: Prime and grade A properties in high demand
Abu Dhabi’s total office stock currently exceeds 43.5 million sqft, with Prime and Grade A assets comprising approximately 30% of the market, while the remaining 70% is attributed to Grade B and C categories. Prime office buildings command rents ranging from AED 180 to AED 260 per sqft per annum, driven by factors such as location, building quality, and floor plate efficiency. Grade A offices continue to witness strong occupier interest, with annual rental rates between AED 150 and AED 180 per sqft, reflecting sustained demand for high-quality space amid limited new supply.
