|Deloitte predicts further growth in 2023 for real estate markets in Dubai and Saudi Arabia
Middle East: Deloitte released its ninth annual Middle East Real Estate Predictions 2023 report focused on the performance of Dubai and Saudi Arabia’s real estate markets over the past year. The report provides a positive outlook for 2023 and delves into different real estate segments including hospitality, residential, retail, commercial office space and industrial.
Among the key findings, the report reveals the recovery post-COVID-19 of tourism in both Dubai and the Kingdom of Saudi Arabia (KSA), with the key indicators within the hospitality sector being the increase over the past year in occupancy and average daily rates (ADR). The report also highlights the growth in residential sales across both geographies, as well as the rise of rent prices of commercial office space in Dubai. While the significant growth of KSA’s gross domestic product (GDP) is making it among the most attractive global destinations for investors.
“As global economies fully re-open post pandemic, we predict continued growth in the Saudi Arabian real estate market throughout 2023. Growth is set to be driven by robust spending across a wide range of government initiatives as well as a strong private sector that is responding to pent up levels of demand for good quality real estate projects. While 2022 saw record levels of demand for commercial office space as a result of ‘Programme HQ’, 2023 looks set to be dominated by the delivery of high quality residential-led mixed use schemes and a continued focus on tourism, leisure and entertainment projects,” said Stefan Burch, Partner and Head of Real Estate at Deloitte Middle East.
Oliver Morgan, Partner and Head of Development in Deloitte’s Real Estate team in the Middle East said, “2022 has been a prosperous year for residential investors who had a tough time looking back at more recent trends in Dubai. In Saudi Arabia, there continues to be excess demand across all residential sectors with more volume housebuilders competing for market share and to differentiate their product. Riyadh and Dubai continue to be attractive commercial markets as occupiers search for growth away from the Far East and Europe. Investment in infrastructure plus evolving retail and F&B offers are a social marketer’s dream which continue to draw record levels of tourists to both locations.”
Dubai’s real estate performance:
KSA’s real estate performance:
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Deloitte & Touche (M.E.) LLP (“DME”) is the affiliate for the territories of the Middle East and Cyprus of Deloitte NSE LLP (“NSE”), a UK limited liability partnership and member firm of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”).
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