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Cavendish Maxwell reported that average warehouse rents in Dubai rose 12.4 percent year on year during the first half of 2026, pushing the total rental value up 9.9 percent to 1.8 billion dirhams even as overall leasing contracts fell 4.5 percent to roughly 10000. Renewals surged 21.6 percent to a record 8200 agreements, accounting for four out of every five contracts signed in the period. New leases dropped 51.8 percent to about 1800, a shift the consultancy attributed to heightened caution among occupiers facing uncertainty from the regional war.
Vidhi Shah, director and head of commercial valuation at Cavendish Maxwell, described an occupier market of strong retention but a reduced appetite for new space commitments. The consultancy’s September analysis noted that every monitored location recorded higher rents than a year earlier, though quarterly momentum began to soften after an initial spike. Emirates NBD tracking echoed the pattern, with established tenants reassessing expansion plans while inquiry levels remained stable amid the geopolitical tensions that escalated in March.
Knight Frank figures placed total industrial and logistics requirements in Dubai at 12.3 million square feet for the first half of the year, a modest increase from the prior period, yet many deals were deferred after the conflict intensified. The limited pipeline of new supply, estimated at just 780000 square feet of speculative space for the full year, has reinforced scarcity in prime areas such as Jebel Ali and Al Quoz. Grade A warehouse occupancy reached around 95 percent, according to Cushman and Wakefield data, leaving few alternatives for businesses seeking to relocate.
The regional conflict, which began on February 28 and led to a temporary pause in around one third of active warehouse requirements at its peak, shifted occupier priorities toward continuity over growth. Knight Frank noted that some paused deals returned following an April ceasefire, but the broader caution persisted into the second half of the year. Essential goods storage emerged as a particular pressure point, with one logistics expert telling Knight Frank that the disruption highlighted the importance of resilient supply chains without causing widespread shortages.
ValuStrat’s second quarter review placed warehouse asking rents 11.9 percent higher than the previous year, with industrial capital values up 17.7 percent and Al Quoz recording a 30.4 percent annual gain. This pricing power for landlords with quality stock has encouraged existing tenants to lock in renewals rather than test the market for expansion space. Short term leases continued to dominate, representing about 95 percent of both new deals and renewals, as businesses maintained flexibility while awaiting greater clarity on the conflict’s long term effects.
Retail leasing exhibited a similar but less pronounced trend, with renewals edging up 1.5 percent and rents climbing 4.4 percent, according to the same Cavendish Maxwell report. The combined data underscores a selective phase in Dubai’s commercial property market, where investors continue to acquire assets but occupiers prioritize proven locations over new commitments. Further reports from industry consultants project sustained demand in core logistics zones as the emirate’s role in regional trade endures despite the ongoing uncertainty.
