The UAE's real estate sector is going to see an influx of global private capital

The UAE's real estate sector is going to see an influx of global private capital, institutional capital, and international family offices and funds as the market matures.

The UAE's real estate sector is poised for a significant influx of global private capital, especially from institutional investors, international family offices and funds as the market matures. With a strong regulatory environment that supports international capital in benefiting from the opportunities, capital from all over the world is converging on the UAE.

It is also expected to see a shift towards digitization with Cryptocurrency, Tokenisation, Virtual Assets, Crowdfunding, Fractional Ownership, among others.

Discussing the outlook for this sector in 2025, Amit Goenka, Chairman and MD of Nisus Finance, shares his thoughts on what’s driving the growing appeal of real estate funds like his—and how institutional investors are benefiting from the size, speed and governance advantages they offer over traditional channels.

"UAE has historically been seen as a trading hub—and not a permanent economy for international investment directly into capital assets. However, with the extraordinary vision of the Rulers, who have created future ready foundations, we see a paradigm shift.

The UAE is now more of a destination for global capital to invest and benefit from the opportunities thanks to its strong regulatory environment, progressive policies, and supportive ecosystem.

The UAE real estate market comprises almost US$680 billion of assets and US$ 207 billion of annual sales today. It is one of the fastest growing real estate markets globally with the highest rental yields, hospitality demand and new emergence of office, healthcare, education, and industrial assets, which are in short supply.

We see that the total amount of funding required each year to continue this pace of growth is in excess of US$100 billion.

Also traditional families are unlocking legacy assets with an estimated USD 8 billion of free hold rented assets available for sale and another USD 6 billion of GCC assets for sale. There is hence a unique opportunity for institutional funds to buy into this USD 14 billion plus basket.

Monies realized from such sales will recycle back into new age asset classes like tokenization and new real estate projects.

So we see this USD 100 billion real estate finance gap and USD 14 billion of asset sales as core value proposition. So, the need for private capital, private credit, and private equity to part-fund or buy into these developments is very critical to continue the current pace of growth."

What are the key trends that you are monitoring in the affordable housing segment in 2025—and what role do you see for new capital to support this evolving need?

"We have a sharp focus on affordable housing. About 95 percent of the rental demand lies in the affordable housing market which is under short supply.

We have seen nearly 1000 families take up residency each day in Dubai (which makes over 90,000 residencies in the first quarter of 2025) which are prime consumers for mid income and affordable housing The rental growth has surged by over 28% y-o-y and capital value has gone up by over 20% on the back of this influx.

For investment, affordable housing is always a safe bet as demand will continue to be high for affordable housing as over 4 million people are expected to be added to the country’s population over the next few years . I don’t think the affordable housing segment will have any problem in attracting investment.

The recent announcement of Dubai Residential REIT, GCC’s first pure-play listed residential leasing-focused REIT, expected to be the GCC’s largest listed REIT, with a gross asset value (“GAV”) of AED 21.63 billion, strongly underscores our hypothesis.

We see that the institutions are now interested in entering the market in a big way.

The market is in the formation stage for institutional capital of participate in this high growth high yield story.

We at NiFCO have been early movers in this segment and have a best-in-class track record in deploying capital in key micro-markets like Jumeirah Village Circle (JVC) and Al Furjan. These are the top mid income housing markets of Dubai. We continue to focus on such key locations like Arjan, Dubai Silicon Oasis, Barsha, Motor City, Production City, Dubai South etc and GCC locations like Mankhool which are top destinations for mid income executive housing.

With key infrastructure initiatives like Etihad Rail, the Al Makhtoum International Airport, the growth is now south bound. The rental demand in these locations are nearly 5x of supply.

Even after the new under construction projects are delivered, there will be an estimated shortage of nearly 39,000 dwelling units in Dubai basis current demand and much larger with the continued influx. Rents and capital values will hence continue to climb sharply over the next few years, delivering very high yields and appreciation to our portfolio."

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