The first quarter of 2013 has seen increased demand for
Dubai’s office and retail space, leading experts at Cluttons to say that the
improved situation will encourage stalled developments in the Gulf city to
restart.
This new confidence is being led by Dubai Mall’s huge pull
as a global shopping destination. However, despite the good news, Dubai’s
office market continues to be very fragmented with some submarkets struggling
to attract tenants.
Rents have increased over the past six months in Jumeirah
Lake Towers (JLT), Tecom C, Al Barsha and Business Bay, all areas that had been
hit particularly hard by the 2008 property collapse. Rents in these areas fell
by as much as 50 percent in 2009.
Cluttons reported that rents were now up by 10 to 15 percent
in better quality and completed projects.
Retail also saw increased activity during the first quarter
of 2013, according to Cluttons, thanks to increased visitor numbers, high
wealth levels in the city and increased consumer confidence. In February, Emaar
Properties revealed that visitor numbers to the Emirate had risen by 20 percent
in 2012 leading to a retail sales increase of 24 percent.
Annual footfall in Dubai’s malls remained strong, especially
in Deira City Centre, Mall of the Emirates and Mirdiff Mall, which all target
mid to high level income residents and tourists. Their continued success, says
Cluttons, is revealed by low to zero vacancy rates.
The property consultancy also noted strong recent interest
in community retail units located in high-density residential districts such as
the Marina, JLT and Al Barsha.
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