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Khaleej Times
2 days ago
- Business
- Khaleej Times
Abu Dhabi's office market stays vibrant on record rent, demand surge
Marked by record-high rental rates and soaring demand for Grade A space, Abu Dhabi's office property sector is witnessing a powerful surge in growth. According to the Q2 2025 Market in Minutes report by global real estate advisor Savills, the emirate's continued economic diversification, robust business sentiment, and limited supply have combined to create a highly competitive leasing environment, particularly within premium commercial zones. The Central Business District (CBD) recorded an exceptional 42 per cent year-on-year increase in rental rates in the second quarter, driven by rising demand and near full occupancy in flagship buildings. Outer CBD areas also saw strong growth, with rents increasing by 18 per cent during the same period. Notable commercial towers such as City Gate Tower and Abu Dhabi Global Market (ADGM) experienced annual rental hikes of 43 per cent and 30 per cent respectively, underscoring the appetite for top-tier commercial spaces. Within ADGM, where the financial free zone has solidified its reputation as a magnet for global firms, rents now range between Dh2,800 and Dh3,500 per square metre annually. Leasing momentum was further buoyed by ADGM's jurisdictional expansion into Al Reem Island in Q1 2025, which added nearly 500,000 square metres of commercial space. As a result, the number of licensed firms operating within ADGM surged 43 per cent year-on-year to reach 2,781 by the end of Q1, while the financial services sector alone grew by 26 per cent. This boom in occupancy and business activity has also translated into a workforce expansion on Al Maryah Island, where the number of employees has exceeded 29,000 — up 17 per cent from the previous year. Stephen Forbes, head of Abu Dhabi at Savills Middle East, attributed the market's strength to the emirate's rising appeal as a global commercial destination. 'Abu Dhabi continues to attract a diverse mix of regional and international occupiers, and the recent expansion of ADGM into Al Reem Island has only amplified that appeal. As more global firms establish a presence in the capital, we're seeing a clear shift toward larger, high-quality spaces,' he said. In the first half of 2025, the primary drivers of leasing activity were firms in banking, financial services, insurance (BFSI), consulting, technology, and hedge funds. There has been an increasing number of requirements for large office units ranging between 10,000 and 20,000 square feet, reflecting the city's growing role as a regional headquarters for global enterprises. Despite the strong demand, new office supply remains relatively constrained. Only about 100,000 square metres of commercial space is expected to be delivered in 2025, with new inventory primarily coming from projects such as Masdar City Square and Yas Place. However, these projects are already witnessing high levels of pre-leasing, indicating the strength of underlying demand. Another 100,000 square metres of space is projected to come online by 2027 from developments like One Maryah Place and Saadiyat Business Park. Savills anticipates that the sustained mismatch between demand and supply will continue to put upward pressure on prime office rents throughout the rest of the year. The advisory also noted that Abu Dhabi's position as a stable and transparent market with strong regulatory frameworks has been instrumental in attracting global investors and occupiers. This sentiment is echoed in the findings of dubizzle's H1 2025 Abu Dhabi Property Sales Market report, which identifies the emirate as one of the region's most attractive real estate investment destinations. Accelerating transaction values across affordable, mid-tier, and luxury residential segments have been driven by a combination of rising prices, investor appetite, and growing confidence in Abu Dhabi's long-term urban vision. The launch of digital property platforms like Madhmoun, aimed at improving transparency and ease of transaction, as well as landmark developments such as the upcoming Disneyland on Yas Island, have added to the city's investment appeal. These efforts are further supported by large-scale infrastructure projects that enhance connectivity and accessibility, positioning Abu Dhabi as a competitive alternative to more saturated regional markets. Overall, the strength of Abu Dhabi's office sector reflects broader macroeconomic trends. The emirate's non-oil economy grew by 6.1 per cent year-on-year in the first quarter of 2025, now contributing over 56 per cent to total GDP. This transformation, part of Abu Dhabi's Vision 2030 strategy to diversify away from hydrocarbons, is translating into sustained investor confidence and a vibrant, forward-looking commercial landscape. Property market analysts predict that with limited new supply, high pre-leasing activity, and a steady influx of international firms, Abu Dhabi's office market is poised for continued growth.
Independent Singapore
05-06-2025
- Business
- Independent Singapore
S$52K rental for Tampines clinic: Ong Ye Kung ‘dismayed,' Ho Ching defends winning bidder
SINGAPORE: After a doctor shared on LinkedIn on Sunday (June 1) that a General Practitioner (GP) clinic in Tampines was being charged a monthly rental rate of more than S$52,000, many Singaporeans expressed their shock online , in keeping with growing dissatisfaction with rental rates across the city-state, as many feel they've become too expensive. Since then, the story has unfolded further, with the company that won the rental bid explaining its side, telling CNA the high price it pays for rent will not be passed on to its patients by way of higher fees for consultations and medications. Andrew Chim, the co-owner of I-Health Medical Holdings, was quoted in a Jun 4 (Wednesday) report as saying that 'Rent is not commensurate with (consultation) fee. I can assure you that the total bill for different cases will be in range for other heartland clinics.' Later that day, Health Minister Ong Ye Kung weighed in on the issue, writing in a Facebook post that he was 'dismayed' by the rental bid, which is equivalent to S$1,000 per square meter. See also Malaysia-born swimming champ jailed 8 weeks for defaulting on NS 'This must translate to higher cost of healthcare one way or another and negate the effort of Ministry of Health, Singapore (MOH) to try to keep the cost of primary healthcare affordable,' he wrote, adding, 'More importantly, higher rental bids do not necessarily translate to the best healthcare that the community needs.' He emphasised the growing importance of GPs in Singapore's ageing society, highlighting their vital role in fostering the necessary trust between doctors and patients, as the latter are guided toward better health outcomes. 'He or she is the vital link to connect patients to acute hospital care, preventive community care, and social prescriptions,' he wrote. Mr Ong added that in May, the Health Ministry and the Housing Development Board (HDB) launched a Price-Quality evaluation Model (PQM) at Bartley Beacon. In this new approach, the quality of care accounts for 70% of the tender evaluation, while rental makes up the remaining 30%. Although the Tampines clinic had been awarded before the new PQM, he said that it will become the norm for when tendering GP clinics in HDB heartlands. On Thursday morning, however, the winning bid for the S$52,000 clinic at Tampines appeared to be defended by Ho Ching, the former CEO of Temasek. In a Facebook post, Madam Ho, the wife of Senior Minister Lee Hsien Loong, wrote that the company that won the bid is 'not a newbie' as it has won and lost bids in the past and has three other existing clinics. 'These are folks who have experience and know the operating costs,' she added, explaining that the company had assessed its bid as a long-term investment, building its clientele with families in a new estate that would remain loyal through the years. 'They even studied how many BTOs (build-to-orders) are coming up and what other developments are coming up before they bidded. They are not going into an established area where families already have existing old family GPs that they trust and go to as their family doctor,' wrote Mdm Ho, adding, 'They expect to break even by about 18 months.' /TISG Read also: Singaporeans shocked by S$52K/month rental for Tampines clinic
