Office Rent Pressures on Small Businesses in Dubai

Dubai's office market is experiencing a surge in demand, leading to increased rents and, in some cases, eviction notices for small and medium-sized businesses (SMEs). Landlords are capitalizing on the high demand, often requesting significant rent increases upon lease renewal, sometimes by 20-30%. This trend is particularly affecting Grade B office spaces, where smaller, non-institutional operators are more likely to prioritize rent hikes. Occupancy levels in top-tier and Grade A buildings are already in the high 90% range, leaving limited options for businesses seeking alternative locations.

Eviction notices are becoming more common, especially for smaller office spaces, as some landlords, often individual investors, aim to sell or repurpose their properties. However, tenants have legal protections. Landlords must provide a 12-month legal notice, issued through the court, before eviction if they intend to sell the property, use it personally, demolish it, or renovate it. If the eviction is due to demolition or renovation, the landlord must obtain necessary licenses and provide a technical report.

Businesses facing eviction should be aware of their rights and the regulations in place. The Rental Disputes Centre (RDC) under RERA can be used to claim compensation if the landlord violates these provisions, such as re-renting the property within three years after eviction. Office rents for SMEs in areas like Bur Dubai and Deira can range from Dh350,000 to Dh650,000 annually, depending on the building's quality and facilities.