Global investment companies are increasingly eyeing Dubai‘s booming real estate market, with major firms lining up for a piece of the action. As the city becomes a magnet for international capital, industry giants like Brookfield Corp and Goldman Sachs are making significant investments, signaling a robust future for the emirate’s property sector.
Bloomberg has reported that Canada’s Brookfield—already known for its joint venture with the Investment Corporation of Dubai (ICD) on the ICD Brookfield Place, a highly successful 53-storey commercial property in the Dubai International Financial Centre (DIFC)—is now planning to develop a mixed-use community in the Dubai Hills area.
Dubai Attracts Investment Heavyweights
Goldman Sachs is also making strides in the region, particularly in the hospitality sector. The firm’s asset management division has recently added $25 million to its initial investment of $35 million in the UAE-based Sunset Hospitality Group (SHG). SHG aims to manage or operate 20 hotels by 2026 across key cities, including Barcelona, Milan, and Singapore.
Hillhouse Investment, another major player, is making headlines for its robust activities in Dubai’s real estate market. The Asian private equity firm, which manages assets worth $100 billion, backed Ascentium’s acquisition of UAE-based Virtuzone. Additionally, its real estate unit, Rava Partners, recently purchased the real estate of Hartland International School for an impressive $100 million.
Bloomberg also reported that Mapletree Investments, linked to Singapore’s sovereign wealth fund Temasek, is planning to invest around $2 billion in the Gulf region following the opening of its Abu Dhabi office last year. The firm’s interest signifies a broader trend of global investment companies vying for a piece of the Dubai real estate market.
In nearby Abu Dhabi, New York-based Apollo has made waves by investing $500 million in Subordinated Notes issued by Aldar Properties earlier this year. This corporate hybrid private placement is among the largest in the region’s history, elevating Apollo’s total investment in Aldar to approximately $1.9 billion across four transactions since 2022.
Jamshid Ehsani, an Apollo Partner, noted, “We are pleased to broaden our partnership and provide another scaled capital solution to Aldar by investing in a leading real estate franchise that we believe offers an attractive investment opportunity for our clients.” His remarks underscore the growing influence of prominent investment firms in shaping the future of the Dubai real estate market.
Andrew Love, head of capital markets and commercial agency at Knight Frank, remarked on the surging demand from overseas buyers. He stated, “The past two years have been busier for us than the whole previous decade on the capital market side. Demand is growing from overseas buyers, who are coming in search of better returns and lower taxes.”
In its H2 2024 Dubai Office Market Review, Knight Frank revealed that average lease rates across key submarkets have risen by 9.1%. The agency also noted that in the last 24 months, eight office building sales have been recorded in Dubai, surpassing the number seen in the previous decade combined. This surge follows 15 hotel transactions occurring over the past 30 months.
The report attributes Dubai’s resilience and strong recovery from the COVID pandemic, highlighting that the emirate was among the first cities globally to reopen for business. The government’s ‘Golden Visa’ programme and attractive policies for businesses, including cryptocurrencies and hedge funds, play a pivotal role in drawing global investment companies to seek their share of the Dubai real estate market.