Dubai’s retail property sector has illustrated remarkable growth in the first quarter of 2026, marked by a significant upsurge in investment activity. The soaring sales, attributed largely to the strong interest in off-plan assets, have rocked the market, with total sales values escalating by 171% year-over-year to AED 2.1 billion (approximately $571.7 million).

Outstanding Growth in Off-Plan Retail Transactions

According to the insights from property consultancy Cavendish Maxwell, there has been a staggering 225% increase in off-plan retail transaction values, reaching AED 1.3 billion (about $353.9 million) within the first three months of the year. This segment alone contributed to over 60% of the total retail sales for the quarter. Moreover, the market recorded 485 retail transactions, reflecting a remarkable 52% boost compared to the same time last year, with the average price per property experiencing an almost 80% rise to AED 4.3 million (around $1.17 million).

Off-plan retail transactions surged to 254 during this period, indicating a 75% year-on-year increase. Sales volumes fluctuated monthly, starting strong in January with 139 transactions, escalating to 196 in February before slightly dipping to 150 in March. Notably, the moderation in the March figures was attributed to a decline in ready properties, where transactions saw a 36% decrease from March 2025.

The Landscape of Dubai Retail Sales

Cavendish Maxwell highlighted that the off-plan sector continues to outperform expectations, with March sales soaring by 195% compared to the previous year. However, experts advise caution regarding the March stats, as it takes 60 to 90 days for off-plan transactions to be registered, suggesting future data may provide a clearer understanding of ongoing demand trends.

During the first quarter, average retail rental rates also demonstrated growth, rising by 6.4% year-over-year, although performance levels varied across different parts of Dubai. Business Bay led the way with a notable 12.6% increase in rental rates, closely followed by Downtown Dubai and Jumeirah Village Circle with respective increases of 12.5% and 12.2%.

During Q1, nearly 19,800 retail lease contracts were executed, with renewals constituting over 82% of the total. However, total leasing activities experienced a 7% dip, mainly due to a decline in new leases by about one-third, indicating a tendency among occupiers to remain in their current spaces. March itself saw around 4,600 rental deals, showing a 15% decline from March 2025, exacerbated by a 41% drop in new lease demand.

Exploring Warehousing Demand in Dubai

The demand for warehousing in Dubai also continued its upward trajectory, thanks to the emirate’s pivotal role as a logistics and distribution epicenter. In the first quarter, around 5,800 warehouse leasing agreements were signed, with renewals constituting nearly 84% of all contracts—a robust 15% increase year-over-year. On the downside, overall warehouse leasing activity faced a 7.3% decline compared to Q1 2025, as new leases plummeted by half.

In March alone, renewals surged nearly 29%, while new leases crashed by around two-thirds year-on-year, leading to an 11% overall reduction in activity as compared to March 2025. Meanwhile, average warehouse rents climbed by over 16% across Dubai, with Jebel Ali experiencing the strongest rental upturn at nearly 21%.

In conclusion, despite the challenges posed by fluctuating market dynamics, Dubai’s retail and warehousing sectors demonstrate resilience supported by population growth, ongoing economic advancements, and favorable market fundamentals. With continued government backing and attractive investment plans under the D33 agenda, the future looks promising for stakeholders in Dubai’s evolving real estate landscape.