Offices between 100sqm and 500sqm in demand
Abu Dhabi prime and Grade A office rental rates remained steady in the second half of last year, according to real estate firm Knight Frank.
Prime office rental rates were recorded at AED 1,900 per sqm, while rental values for Grade A shell and core office space were at AED 1,300 per sqm.
The report says that while they did witness a slowdown in the number of enquires, partly due to companies reviewing the impact of oil prices, 75% of enquiries involved offices between 100sqm and 500 sqm in size.
It also notes that Grade A and prime supply has remained subdued, making it important for landlords to maintain headline rents.
The report forecast that, although the number of new developments under construction are limited, they could witness further delays in completion.
“With economic growth expected to slow and UAE inflation expected to fall from 4.0% in 2015 to 3.5% in 2016, the outlook for the UAE still remains positive,” said Matthew Dadd, Partner at Knight Frank.
“However, demand from occupiers is expected to remain low with take up for smaller requirements. There is however, limited supply entering the market, which will mean landlords will not witness a jump in availability across the market”.