Can Foreigners buy commercial property in Dubai? Dubai is one of the most extravagant countries in the world. It is famed for its tourist appeal and magnificent infrastructures. The Dubai skyline, the Burj Khalifa, and many other such iconic constructions add stars to the Dubai sky. Apart from this, the advancements in the infrastructure have turned this semi-arid Arab land into a concrete marvel. Many iconic and signature buildings add to the lust and luck of this state. Apart from this, nearby cities like Sharjah, Bahrain, Kuwait, Oman, etc., provide surplus employment opportunities to people from different countries. People invest millions and billions in buying property in Dubai because of its appreciating value in the market. The Dubai real estate market is as vast as it is becoming, and people from all over the world, including eminent celebrities, sportspersons, and politicians, invest in buying properties in Dubai.
In this article, we will get an insight into how an expatriate can buy commercial properties in Dubai and what kind of properties in Dubai are available for foreigners.
Policies for foreigners buying commercial property in Dubai
Is it possible for a person to buy a property in a country he is not living in? The answer to this question varies depending on each country’s foreign and internal affairs policies. In the case of Dubai, a foreign national can buy property in Dubai, but with specific rules and regulations. Let us look at the laws one needs to follow for buying property in Dubai:
- A non-resident can buy property in Dubai on a freehold basis. However, the Dubai government has a specific restriction on where these properties can be purchased.
- A foreigner can buy properties in Dubai in only these areas:
- Dubai Marina
- Downtown Dubai
- Jumeirah Village Circle (JVC)
- Arabian Ranches
- Palm Jumeirah
- All these areas are permitted for buying and selling properties on a freehold basis. However, the prices of the properties in these prime localities are too high, but not high enough for foreign nationals.
- Foreign nationals can buy the following types of properties in Dubai:
- Hotel apartments
- Villas and Townhouses
Let us read about what kind of properties can a foreign citizen buy in Dubai.
Types of Commercial properties for foreigners to buy in Dubai
In Dubai, the commercial real estate sector is enormous and offers a wide range of financing and industry opportunities, from completely furnished offices to specially designed factories. Below is a thorough master reference to properties in Dubai’s many economic sectors. It will help you allocate your funds more effectively to the regions where business growth is most likely to occur and will also give you an idea of how much these units will cost you to acquire or rent.
Dubai is an industrial hub with great scope for any business. It is home to new, growing companies and big influential industries. Dubai also offers a wide range of office spaces to purchase and rent to foreigners. These spaces (rented or purchased) can be either furnished or unfurnished. However, basic furnishing is done in all the newly constructed spaces. The prime localities where these office locations are available for purchase are Business Bay, Jumeirah Lake Towers, the Sheikh Zayed Road, Deira, and Bur Dubai. The average selling price for office space in Dubai starts at $68,100 for a 25-35 sq. mt. area. However, for renting and leasing, the prices can vary depending upon the size of the rented area.
2. Coworking Spaces
With growing numbers of businesses and startups, the concept of coworking spaces is becoming popular day by day. Coworking spaces require minimal capital investment in building offices and buying office furniture. Coworking spaces are also popular among freelancers as they get more opportunities for networking and making good contacts. These spaces allow you to design a workspace as a collective office, offering employees a more comfortable and corporate environment. The lower cost of renting the spaces due to the joint payment will also be an undoubted advantage. Hourly, daily, and monthly fees might be levied for the usage of the properties. Several well-known single and network coworking spaces, like Nest, Bureau Dubai, Nook, Our Space, and others, are also located in Dubai. Here, you can purchase a company to operate one of the already-existing locations or buy an office that you can customize to your needs and tastes. Most importantly, these locations are well-liked by IT professionals and are ideal for holding specialized lectures and seminars, performing services for authorized businesses, and serving as a treatment and spa, among other things.
Usually, these properties charge around $2800-$19000, depending upon the area’s size and the office’s location. Also, the price may sometimes rely on the coworking space’s neighbouring offices. If you want to sit among prominent industrialists, you might have to pay more for such a coworking space.
3. Retail Stores
Another excellent investment in infrastructure from Dubai’s perspective can be buying retail spaces. Commercial properties in Dubai always ensure maximum return on investment. And if you are keen on setting up your own business, then you need a lavish space to set it up. If you are setting up a retail store, you must ensure that it should be in a location in Dubai that witnesses maximum footfall and attracts shoppers. Purchasing retail units and shops in Dubai is a very profitable investment. This type of commercial real estate is in demand in any area or community of the emirate, and you can buy them both in the secondary and off-plan real estate market.
These retail stores and shops should be bought in only prime locations like Jumeirah Lake Towers, Business Bay, International City, Dubai Marina, Meydan, DIFC, Downtown Dubai, and Dubai Silicon Oasis. Their area can range from 344 to 9,945 sq. ft, and the sale price of units starts from AED 150,000 (USD 41,000) and above. In addition to the areas mentioned earlier, Al Barsha, Deira, Jumeirah, and Bur Dubai, offer rental options ranging from 99 to 37,996 sq. ft at prices varying from AED 15,000 (USD 4,100) to AED 4,000,000 (USD 1,090,000) per year.
However, one must remember that these areas are highly prestigious and prebooked. Sometimes they are booked at an early-bird price even before a construction stands up on the ground. These areas are high in demand and witness maximum footfall. So, the costs of the products you sell here will also have to be higher to compensate for the rent or lease amount. Apart from these three types of properties, there are many other types of commercial properties in Dubai that a non-resident of Dubai can purchase for investment or business expansion. These are showrooms, commercial buildings, villas, lands, plots, warehouses, factories, and labour camps.
Things to remember
There are various things a person should keep in mind before thinking of purchasing commercial properties in Dubai.
Firstly, the real estates in Dubai are high in demand. So, it is not always possible for the landlord to keep a fixed rent. So, if you have rented a commercial place in Dubai, brace yourself for any increase in the rent amount as per the market rates.
Secondly, the return on investment is quite evident in the case of commercial properties in Dubai. If you have purchased good properties, chances are you will make a profit of 4-8% per year on that property. This profit is in terms of the value of the piece of land you know plus the rent you will be charging from the renter. This is why many foreigners are interested in purchasing commercial properties in Dubai. If you keep these points in mind, your investment in commercial properties in Dubai will not go in vain, and you can earn a good income from the property you purchased. Either you can use it for your own needs, or you can rent or lease it. Either way, you are in profit.
Benefits of buying commercial properties in Dubai for a foreigner
Buying a property anywhere is never harmful. You must invest in real estate with a surplus amount and good capital. This can be a continuous source of earning for you. Besides, you can also use the property at any given time for your purposes. The benefits of buying commercial properties in Dubai are
For foreigners, it is especially beneficial as they have a spare place in another country to go to. If you have bought a house or a hotel apartment, it can be given for rent for a couple of years. And after the completion of the time duration, you can use that property as a vacation home. What can be better than having a vacation home in Dubai?
Secondly, it can be a good source of income for foreigners and help you get citizenship in Dubai at a later point in time. So, if the prices are hiked, you can either sell your property for a better price at a high-profit margin or keep it for yourself. Considering these benefits, we can say that buying commercial properties in Dubai can be an excellent idea for any foreigner.