CONSTRUCTION
Dubai’s construction sector is an important driver of the economy, and the city’s pioneering vision when it comes to sustainability and innovation is helping to shape the future of cities around the world. Dubai’s iconic structures and developments have made it instantly recognisable and the construction sector in general has provided a foundation on which the city’s growth has been built in recent decades.
The UAE construction market is currently valued at US$805 billion according to MEED Projects and Dubai is at the heart of this with a dynamic real estate market that elicits a strong appetite for investment from around the world underlining the long-established attractiveness of property in the city. The value of real estate transactions in Dubai in 2019 increased to US$62.1 billion and, despite the COVID-19 pandemic, the sector grew 3.7 percent in the first quarter of 2020 compared to Q1 2019. FDI into Dubai’s real estate market was up 17 percent to US$28.9 billion during this period with new investors accounting for 57 percent of transactions and investments. With the population of the UAE expected to increase from 9.34 million to 11.5 million by 2025, Dubai’s construction and real estate sector has plenty of room for continued growth.
A Supportive Legislative and Regulatory Environment
Central to the attractiveness of Dubai’s construction and real estate market is a progressive regulatory environment that protects both investors and stakeholders while also encouraging innovation and growth. A number of recent updates have enhanced the sector including a new joint ownership law that was introduced in 2019 that puts an increased onus on developers to ensure they maintain the highest standards in order to protect the interests of investors. Dubai’s low-to-zero property tax rates also makes it stand out from other cities around the world and the variety of opportunities available, both onshore and offshore for both residential and commercial property investments, means there is something for everyone.
Continued Construction Opportunities
Dubai’s ongoing investment in infrastructure including aviation facilities, public transport and the road network continue to bolster the construction sector. Demand for schools, hospitals, utilities and other services in the long-term will also require expertise and investment into the sector. When it comes to commercial real estate, growth across multiple sectors continues to result in strong demand for offices, warehouses and manufacturing facilities, and new hotels, venues, attractions and entertainment options also provide viable investment opportunities. Residential developments, from affordable apartments to high-end villas, will also be needed going into the future to cater to the growing population.
Smart construction techniques are becoming more popular in Dubai and, in line with the goal to have 25 percent of all new buildings in Dubai be 3D printed by 2030, the city unveiled the largest 3D printed building in the world in 2019, a two-storey, 640 square metre Dubai Municipality facility, built with local components using onsite 3D printing equipment.