Dubai Commercial Property Market Reaches Historic Peak Despite Regional Tensions

Dubai’s commercial real estate market broke its own records in the first half of 2026, with office and retail transactions climbing to levels never previously seen in any opening six months, even as regional uncertainty briefly cooled buyer confidence in late February.

Commercial sales across Dubai totaled AED 62.2 billion across 6,470 transactions during the period, the highest sales volume and value ever recorded for a first half of the year. Office transactions rose 35.3 percent year-on-year to 2,570 deals. Retail sales climbed 50.2 percent to 853 transactions. The value of office sales alone reached AED 15.8 billion, nearly triple the AED 5.4 billion recorded in the same period of 2025.

The sharpest shift came in off-plan commercial investment. Buyers and developers targeted the next generation of Grade A office and retail developments with striking conviction, pushing off-plan commercial sales value to AED 17.0 billion, nearly six times the AED 3.0 billion recorded in the first half of 2025. Transaction volumes in this segment more than doubled, rising from 1,239 to 3,123 deals.

Meanwhile, the residential sector continued drawing both domestic and international buyers across a wide range of price points. Dubai recorded 80,509 residential sales valued at AED 226.5 billion during the six months. The ultra-prime segment was especially active: 320 residential properties valued above US$10 million changed hands, a 23 percent year-on-year increase. Those transactions generated a combined value of US$6.0 billion and accounted for 9.7 percent of Dubai’s total residential sales value.

Market dynamics shifted across the period. January and February opened ahead of the prior year’s pace, but heightened regional uncertainty from late February led buyers to take longer over purchasing decisions, moderating activity through the middle months. Transaction volumes recovered in June as conditions improved, a sign of underlying demand rather than speculative momentum.

During the uncertain stretch, buyers placed greater weight on property quality, location, developer reputation and long-term value. Performance held up particularly well in established villa communities and the prime residential segment. High-value sales concentrated in Jumeirah, Jumeirah Asora Bay and the Dubai Water Canal, where buyers sought waterfront residences offering privacy, architectural distinction and access to premium amenities.

The geographical spread of ultra-prime transactions also reflected how Dubai’s luxury residential landscape has broadened. Established prime destinations retained strong appeal, but a new generation of developments gave high-net-worth buyers additional options in lifestyle-oriented communities.

The residential leasing market stayed highly active throughout the first half. Rental demand was supported by Dubai’s growing population and established resident base, while greater availability in parts of the market gave tenants more choice. Commercially, 163,356 rental transactions were recorded, broadly in line with the exceptionally strong levels seen in the same period of 2025.

Daniel Hadi, CEO of Engel and Völkers Middle East, described the first half as evidence of the market’s resilience and increasing maturity. “We saw buyers become more considered during the period of regional uncertainty, but importantly, demand remained present and activity began to strengthen again as conditions improved,” Hadi said. “What continues to give us confidence is the depth of the market, from growing international demand for exceptional ultra-prime homes to sustained activity across the wider residential sector.”

The traditional summer period is expected to bring more measured activity before the market moves into the final months of the year. Regional developments may continue to shape sentiment in the short term. Whether the recovery in June carries through the second half, or faces fresh headwinds, will determine how 2026 is ultimately measured against the records it has already set.