UAE’s industrial real estate sector recorded strong and sustained demand during the third quarter of 2026, driven by tailwinds like new companies entering the market and existing businesses expanding, pushing occupancy rates in prime industrial areas in Dubai and Abu Dhabi towards full capacity amid limited availability of high-quality space.
As per real estate consultancy JLL’s latest market report, the sector remained resilient despite regional geopolitical challenges (read the Iran war), supported by the expansion of international and regional logistics and e-commerce companies and increased investment in the UAE’s operational facilities and supply chains.
“Businesses have also been reassessing supply-chain strategies, increasing safety stock and prioritising more reliable overland transport routes, supporting the sustainable growth of the UAE’s industrial and logistics sector,” the report noted further.
While new industrial leasing contracts in Dubai increased by 25.7% year-on-year, reflecting growing underlying demand for industrial space, renewals declined by 8.9% during the third quarter as some tenants opted to relocate or upgrade their facilities.
However, the number of renewed contracts remained 9.5% higher than during the same period in 2025.
Average industrial rents in Dubai reached AED50 per square foot, up 5.9% annually, driven by limited availability of modern warehouses and high-quality industrial space alongside continued demand in the Emirati city for advanced logistics facilities.
“Upcoming Grade A warehouse projects are expected to help ease supply constraints, although higher construction costs could delay completion of some developments,” JLL noted.
In Abu Dhabi, average industrial rents reached AED489 per square metre, up 1.6% year-on-year and 0.6% quarter-on-quarter.
The JLL report attributed the more moderate increase to regulatory restrictions on rental increases, with exemptions applying to certain properties and new developments, while demand and occupancy rates in the UAE capital’s prime industrial areas remained strong.
JLL also highlighted growing investment in Abu Dhabi’s logistics infrastructure to meet rising demand for specialised and advanced facilities.
Abhishek Mittal, Head of Industrial, MEA at JLL, said, “Market activity during the third quarter reflected a shift in the nature of demand, with new companies entering the UAE and existing occupiers moving into higher-quality facilities while redesigning supply chains to strengthen resilience against disruption.”
“The industrial real estate market is becoming more sophisticated and interconnected, with multimodal logistics links being developed across the region, including the AD Ports Group-Etihad Rail bonded corridor, that will help accelerate overland transport across the GCC over the longer term and strengthen the UAE’s position as an interconnected regional logistics gateway,” the senior official concluded.