Dubai Office Rents Rise 12% as Home Rents Ease 7%: Reading CBRE's Q3 2026 Review

Dubai's property market is moving in two directions at once. CBRE's UAE Real Estate Market Review for the third quarter of 2026, released this week, shows average office rents in Dubai up 12% year on year with occupancy around 95%, while average residential rents are down 7% over the same period and home prices are down about 1%. For investors, that changes where the income is. For agents, it changes how renewals and new leases should be priced.

Primary source: CBRE Middle East press release, UAE Q3 2026 market review and the CBRE UAE Real Estate Market Review Q3 2026 (PDF). Arabic coverage: Emarat Al Youm, 4 November 2026. English coverage: Arabian Business.

First, the words

• Year on year (y-o-y): the change compared with the same quarter last year. It smooths out seasonal swings.
• Quarter on quarter (q-o-q): the change compared with the previous three months. It shows the most recent direction.
• Occupancy: the share of available space that is let. Around 95% means very little good space is free.
• Grade A office: modern, high-specification office space in prime districts, the type most sought after by banks and large firms.
• Secondary locations: communities away from the prime core, where much of the new residential supply is being handed over.

The commercial side: tight and rising

Offices

CBRE calls offices the strongest-performing asset class in the UAE this quarter. In Dubai, average office rents rose 12% year on year and occupancy reached about 95%. DIFC, Business Bay and Dubai Internet City recorded strong leasing, driven by financial services, professional services and technology firms looking for high-quality space. The constraint is supply: there is a shortage of Grade A offices in the main business districts. Abu Dhabi went further, with office rents up 20% and occupancy at 96%.

Retail and industrial

Retail occupancy in Dubai reached 97%, with average retail rents up 5% year on year, even with fewer international visitors this year. Industrial and logistics space also stayed in demand: average industrial rents in Dubai rose 12% year on year, driven by e-commerce operators, third-party logistics firms and companies reorganising regional supply chains.

"Demand for high-quality office space remains exceptionally strong, industrial and logistics assets continue to see healthy occupier activity, and Abu Dhabi's residential market is recording sustained growth." Matthew Green, Head of Research, CBRE MENA (CBRE press release, November 2026).

The residential side: a more balanced market

Prices are almost flat

According to CBRE, average Dubai residential prices were down about 1% year on year, with apartments around -2% and villas still slightly positive at about +1%. Over the past six months the dip is larger, about 4% across all properties, but the change over the latest quarter was under 1% for all properties and apartments. CBRE reads this as a sign of stabilisation, with strong support for ready homes. Villa results were mixed: only about a third of tracked communities gained over the quarter, led by The Sustainable City (around +5%), Jumeirah Golf Estates and Emirates Hills (around +4% each), and Al Barari and Palm Jumeirah (around +2% each).

Rents are falling faster than prices

Rents moved more. Average residential rents were down 7% year on year across all properties, 7% for apartments and just under 6% for villas. Over the latest quarter alone, rents fell about 4% overall, 5% for apartments and 2% for villas. CBRE links this to weaker demand from new residents arriving in the city and to new supply being handed over in many secondary locations. It also notes that new leases are being negotiated at notably lower rates than renewals.

Transaction activity has moderated, buyers are more measured, and developers have slowed new launches. CBRE adds that residential values remain well above pre-pandemic levels after several years of fast growth.

Why it matters

When rents fall faster than prices, gross rental yields on residential property compress: the same purchase price now buys a little less income. At the same time, Dubai's offices, shops and warehouses are close to full, and rents there are still rising. That does not mean every investor should switch asset class. Commercial property has its own rules on fit-out, service charges, lease lengths and vacancy risk. But it does mean the "Dubai rent" story now depends on what you own and where.

The backdrop matters too. CBRE notes a more difficult 2026 for the UAE economy, with tourism-linked sectors under the most pressure, while the non-oil private sector keeps expanding (the UAE PMI reached 55.3 in August and September, a 20-month high).

What to check now

If you are a residential investor

• Recalculate your yield on today's achievable rent, not last year's. A 5% quarterly drop in apartment rents is enough to change the numbers on a recent purchase.
• Compare your unit with new supply nearby. In secondary communities with fresh handovers, tenants have more choice and will negotiate.
• Look at ready versus off-plan separately. CBRE sees support for ready homes; our earlier piece on ready homes gaining ground explains the split.

If you are looking at commercial property

• Check the building grade and the district. CBRE's growth is concentrated in high-quality space in core areas such as DIFC, Business Bay and Dubai Internet City.
• Ask for the current rent roll, lease lengths and service charges before trusting a headline rent. Our checklist on office buyer checks is a good starting point.

If you are an agent

The gap between renewals and new leases is the practical point. A landlord who expects last year's rent on a new tenant may sit vacant; a tenant renewing may be paying above what a new lease would cost next door. Bring recent comparable leases to every pricing conversation, and set expectations early with landlords in communities that are receiving new supply. Our guide to why renewals are dropping and tenants shop for terms covers the tenant side. On the commercial side, the clients asking for offices now are mostly finance, professional services and tech firms, and they want quality over price.

What we did not claim

These are CBRE's averages for Dubai as a whole; individual buildings and communities can move very differently. CBRE's figures are an advisor's index, not Dubai Land Department transaction data, and they describe the past quarter, not a forecast. We did not use any figure that does not appear in CBRE's release or report. This is general market orientation, not investment advice.