In 3Q 2025 the new supply remains limited across the UAE for both, office and retail markets, thus pushing both demand and rents up, according to JLL 3Q Office Market Dynamics Report.

RETAIL MARKET

Similarly to office market (pls see our article 2025 Update Part 1), vacancies are plummeting also on the retail market. Abu Dhabi retail vacancy fell to 9% in 3Q, down 5% year-to-year, while Dubai’s dropped to 6.8%, a 2.2% annual decrease. Thus, landlords are increasingly securing retail space in well positioned shopping centers, competing for high-footfall locations.

As to the leasing activity, the interest was mixed. Total retail lease contract volumes in Abu Dhabi diminished 11.1% year-to-year, with new leases reduced 6.8% and renewals fell 14.7%. Dubai saw 2.1% rise in new lease registrations, with renewals increased 3.5% year-to-year.

Furthermore, rents are also growing, though at a softer tempo than for office premises. In Abu Dhabi rents in prime malls climbed 3.4% year-to-year to 5,500 AED per sqm/510 AED per sq ft while in other mall types rose 5.9%. In Dubai, prime malls saw rents soar 13.5% to 9,000 AED per sqm/836 AED per sq ft. 

The new retail premises supply remains modest. In Abu Dhabi, 27,000 sqm was added in 3Q 2025, totaling 3 mil. sqm of retail space, with an extra 11,000 sqm is set to arrive by the end of 2025. Moreover, an additional 98,400 sqm is expected in 2026 and 2027. Dubai has 5.2 mil. sqm/55.9 mil. sq ft of retail space, with new 38,591 sqm/415,400 sq ft due to arrive in 4Q 2025 and 204,390 sqm/2.2 mil. sq ft expected in 2026, chiefly regional malls.

As to the foreseeable future prediction, due to moderate supply and strong demand, rents will most probably continue climbing as tenants do not have effective leverage to push back against  their increases. Thus, landlords are anticipated to continue utilize the strong demand to rise rent rates, particularly in top-performing shopping centers.

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