Offices

Offices

In 2024, whilst we expect the robust level of performance seen in 2023 to continue, global economic headwinds and lack of stock in key markets may hamper market activity.

In Bahrain, Prime and Grade A rents remained stable in 2023, as occupancy increased by 4.0 percentage points, with new supply remaining relatively constrained. With supply expected to increase by 1.1% in 2024, amidst the continuing flight to quality trend, we expect that rental rates will continue to edge down over the course of the year.

In Saudi Arabia, occupier activity will remain relatively concentrated within Riyadh, where, given the elevated demand levels from both national and international occupiers, we saw the headline occupancy rate reach 98.1% in Q4 2023. The lack of availability of quality stock, the very limited amount of imminent future supply and elevated pre-leasing activity are expected to continue to drive performance within Riyadh’s occupier market in the year ahead; that being said, the rate of growth will taper off. As for Jeddah and the Eastern Province, a slowdown in the rate of rental growth is expected over the upcoming year.

Occupier activity in the UAE is likely to remain resolute in the year ahead. Performance within Abu Dhabi’s occupier market will remain relatively strong. We forecast that Prime and Grade A assets will continue to outperform the market, given the scarcity in supply and rising demand for high-quality assets. In Dubai, with the lack of existing quality stock, elevated demand levels and the limited number of developments in the pipeline, which are seeing strong pre-leasing activity, we expect that rental rates will continue their upward trajectory moving forward, however at a slower rate than the year prior.