UAE Real Estate Market Booms as Luxury Penthouse Sells for AED 138 Million

UAE Real Estate Market Booms as Luxury Penthouse Sells for AED 138 Million

19 March 2024, Business Outreach

The UAE real estate market, especially in Dubai, has seen tremendous growth over the past year as the economy rebounds from the pandemic. In one of the biggest and most expensive real estate deals to date, a luxury penthouse at the Nobu Residences in Sharjah sold for a whopping AED 138 million ($38 million). This sets a new record and highlights both the strength of investor demand and confidence in the UAE’s real estate sector.

The penthouse, located on the 20th floor of the Nobu Residences, is part of a luxury development by Aldar Properties and features five bedrooms, a private pool, and panoramic views of the Dubai skyline and Khorfakkan coastline. Encompassing two floors and spanning over 16,000 square feet, it is the largest and most expensive penthouse in Sharjah to date. The unnamed buyer, who is based in the Middle East, plans to use the property as a luxury home for their family.

From a financial perspective, this record-breaking deal underscores the growing popularity of luxury real estate investments in the UAE. With the economy recovering strongly on the back of fiscal stimulus, business-friendly reforms, and a successful vaccination drive, wealthy investors are once again pouring money into prime properties. The penthouse sale price of AED 138 million works out to over AED 9,000 per square foot, highlighting the premium that high-net-worth buyers are willing to pay for the most exclusive addresses.

The UAE real estate sector has witnessed strong growth over the past year with rising sales, increasing demand, and rebounding prices across most segments. According to leading real estate consultancy Knight Frank, Dubai residential sales volumes increased by an impressive 63% year-on-year in 2021 with over 91,000 transactions recorded, the highest since 2014. Average apartment and villa prices in Dubai rose by 4-5% during the year with prime freehold areas appreciating even more.

The luxury end of the market, in particular, has seen eye-watering deals as global wealth flows into the UAE. In Dubai, high-profile property purchases in 2021 included a AED 150 million ($40 million) villa and a AED 280 million ($76 million) beachfront mansion. Meanwhile, Abu Dhabi also saw increased interest with global citizens and investors acquiring multimillion-dollar villas and apartments across the emirate.

Looking ahead, industry experts expect the positive momentum in the UAE’s real estate sector to continue in 2022 and beyond. With major infrastructure projects, business events, and the FIFA World Cup later this year, Dubai is poised to attract greater foreign investments and talent. At the same time, the country’s pro-business environment, political stability, world-class infrastructure and lifestyle amenities will continue drawing wealthy individuals and families to the UAE real estate market.

In summary, the record-breaking sale of the Nobu Residences penthouse in Sharjah reflects the strong underlying demand and bullish sentiment across the UAE property sector. As the economy diversifies and real estate remains an attractive asset class for investors, high-value deals such as this will likely become more commonplace. Going forward, the luxury end of the market is expected to outperform as global wealth seeks prime assets in one of the world’s most desirable destinations.

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