Residential Projects Worth $125 Billion Underway in the UAE by Q1 2024

The UAE’s Construction Market Performance in the First Quarter of 2024

JLL Real Estate’s latest report on the UAE construction market performance in the first quarter of 2024 has shed light on the region’s impressive growth prospects despite global challenges like inflation, high interest rates, and geopolitical tensions. The value of unfinished construction projects is projected to reach a significant amount, with the Middle East and North Africa region accounting for $3.9 trillion, with the UAE owning a 15% share.

The report highlights the UAE’s high-value projects worth $590 billion, with residential projects accounting for $125 billion (21%) and mixed-use projects making up $232 billion (39%). In Dubai, there was a 21% increase in sales and rental prices year-on-year, with 10,000 residential units delivered in the first quarter of 2024. Abu Dhabi saw the delivery of 1,600 units with a further 6,000 expected by year-end.

Dubai added 2,000 hotel rooms in the first quarter, mainly in the 5-star category, with 5,000 more rooms expected in 2024. Abu Dhabi will add about 500 rooms this year, increasing its total to 34,000 hotel rooms. The UAE’s construction market outlook is positive, with an increase in project value and growth in economic diversification and investment.

Laura Morgan, Head of Market Intelligence at JLL for the Middle East and Africa stated that despite challenges like rising construction costs and demand fluctuations due to price fluctuations in shipping and transportation that can impact construction prices due to reliance on imported materials like glass and steel; however stable availability of construction materials will support improvements in local manufacturing capabilities. She also added that developers could explore smaller projects in secondary areas to manage costs while still maintaining growth momentum.

The global steel production is expected to increase by 1.9% in 2024 supporting rebound of steel demand in Middle East North Africa region indicating that improvements are possible due to global trends which will benefit UAE’s Construction market outlook as well as other countries

By Sophia Gonzalez

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