DUBAI, 11th November, 2026 (WAM) -- Industrial real estate in the UAE recorded strong and sustained demand during the third quarter of 2026, driven by 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, according to JLL’s latest market report.
The report showed that the sector remained resilient despite regional geopolitical challenges, supported by the expansion of international and regional logistics and e-commerce companies and increased investment in 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.
New industrial leasing contracts in Dubai increased by 25.7 percent year-on-year, reflecting growing underlying demand for industrial space.
Renewals declined by 8.9 percent during the third quarter as some tenants opted to relocate or upgrade their facilities, although the number of renewed contracts remained 9.5 percent higher than during the same period last year.
Average industrial rents in Dubai reached AED50 per square foot, up 5.9 percent annually, driven by limited availability of modern warehouses and high-quality industrial space alongside continued demand 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.
In Abu Dhabi, average industrial rents reached AED489 per square metre, up 1.6 percent year-on-year and 0.6 percent quarter-on-quarter.
The 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 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.
This includes the strategic agreement between KEZAD Group and Jingdong Property (JD.com) to develop 150,000 square metres of automated warehousing, Axione’s 37,000-square-metre cold-chain hub at Abu Dhabi Food Hub, and KEZAD Logistics Park 7 (KLP7), which will add 88,135 square metres of logistics space.
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.
He said the industrial real estate market is becoming more sophisticated and interconnected, adding that multimodal logistics links being developed across the region, including the AD Ports Group-Etihad Rail bonded corridor, will help accelerate overland transport across the GCC over the longer term and strengthen the UAE’s position as an interconnected regional logistics gateway.