Rising rents for office and retail space in Dubai is set to continue in 2007 and 2008 according to property management company Asteco. A shortfall of supply by at least 30% will put upward pressure on commercial rents in Dubai as well as in other parts of the UAE.

With an average return on investment in Dubai commercial property of more than 16% expected for 2006 and 2007, it is expected to return twice as much as residential property, which should average 6-8% over the same period.

Since 2002, office rents in Dubai have more than doubled. This is due to the continued expansion of existing companies as well as new companies rushing into Dubai to set up new businesses. Over 40% of today’s tenants in Dubai are believed to be either searching for more office space or to upgrade their existing offices.