Empty office space in Dubai has doubled to 16% in the past six
months, according to Jones Lang LaSalle, the property and investment
firm.
In its February 2009 “Dubai City profile – A Review of the Dubai Property Market”, new research shows that vacancies in Dubai’s office market are at the highest rate ever recorded.
The report states: “The turmoil in the global economy is continuing to cause volatility and uncertainty in the Dubai real estate market. The major economic influences on the market include the significant slowing of economic activity, falling employment levels and a severe tightening of credit.”
An additional 4.7 million square ft of office space was released into the market in the second half of 2008, bringing the total stock to approximately 29.5m square ft; an increase of almost 20% over six months.
Projects completed within this period include The Galleries at Jebel Ali, Cayan Business Centre, Executive Heights, Grosvenor Business Tower within TECOM, the Reef, HDS, Tamweel and Silver Towers at Jumeirah Lake Towers (JLT).
Looking to the future, the report also reveals that “more than 50% of the announced residential and commercial projects due for completion between 2009 and 2012 have now been either put on hold or cancelled. This reflects the lack of available funding and projections of declining population along with continuing job cuts.”
Furthermore, the hospitality market reports the lowest occupancy rate in five years with an average of 79%. This has been brought about by declining visitor arrivals and the release of new rooms into the market.
Over the second half of 2008, approximately 3,245 new rooms were added to the stock of quality hotel rooms in Dubai, with the largest completion being the Atlantis hotel on Palm Jumeirah. This brings the total to approximately 40,000 rooms.