The Allsopp & Allsopp commercial team have noticed a sharp uplift of transactions and enquiries since lockdown ended.
Head of Commercial, Emrah Yar talks about the trends that the commercial team have noticed over the last 3 months.
2020 has thrown some unexpected twists at all of us and the commercial real estate market was hit hard during lockdown with very little action being taken as viewings could not take place and companies put their decisions on hold to see what was to come next. However, once lockdown lifted, the commercial market has bounced back rapidly and our enquiries were back to normal within only a matter of days.
Start-up companies emerging
A number of enquiries have come from new business start-up’s. We have seen sanitization companies and tech companies looking for small office spaces to begin their business. In my opinion, we’ll be seeing a few more start-ups come into the market in the coming months. A combination of opportunity, uncertainty, circumstances people have found themselves in and spending more time at home has made people rethink their careers and has given some the push to get into their own business and make a start. Some will see this as a bold move but as we have seen in the past, companies that start in troubled times can do incredibly well. I would say that now is a good time to look for commercial real estate as companies are moving office spaces to fit their new requirements, so there are many rental and sale options available in the market.
A few companies have been in contact with us to look for smaller office spaces, mainly because they have found that remote working has been beneficial to their business and they have decided to cut rental costs by moving to smaller premises.
We have had enquiries from businesses who are looking to expand and need more offices across the city as a result of more market share coming available in their industry.
Unfortunately during the pandemic, some companies have had to cease trading and their competitors are seeing this as an opportunity to expand their own business and take advantage of the potential new clients that are now available.
Companies moving office location
There has been a reduction in rental prices in the commercial market between 3-7% during the pandemic and this has prompted many companies to upgrade their office location or size. For example, we have had a number of companies contact us about renting an office in Downtown Dubai as opposed to their current office space in Business Bay because they will be paying slightly more for an office in a prime location than their current office and be closer to their clientele.
Commercial Investors are buying
Allsopp & Allsopp have seen a rise in investors who are looking for commercial spaces after the pandemic. Commercial property offers investors a rental return of between 8-10% with a few properties offering even more. Residential investors are often not in the know about the high rental returns commercial property offers. We have had a number of cases where an investor has enquired about residential rental properties offering high rental return and the residential agent has introduced them to the opportunities available in the commercial market and they have decided to invest in office spaces after seeing the yields available.