How UAE real estate continues to attract capital despite Middle East tensions
Investors placing greater emphasis on valuations and due diligence
DUBAI – UAE’s real estate market continues to attract capital despite ongoing geopolitical tensions across the Middle East, although investors and lenders are becoming increasingly selective as they assess risk, according to Archers Valuation & Advisory.
The consultancy says property activity in Dubai and Abu Dhabi remains relatively resilient, but discussions around liquidity, downside protection and transaction risk have become more prominent, particularly in larger and more complex deals. As regional geopolitical, macroeconomic and financing conditions evolve, market participants are placing greater emphasis on asset quality, income durability, refinancing exposure and execution risk.
Capital flow
Archers’ in-house research indicates that capital continues to enter the UAE, supported by the country’s relative stability, favourable tax environment, business-friendly policies and reputation as a safe-haven destination for investment.
Rus Kolinko, Managing Partner at Archers Valuation & Advisory, said the market has not experienced a retreat of investment despite the uncertain regional backdrop.
“What we are seeing is not a withdrawal of capital from the UAE market. If anything, the UAE continues to attract capital during periods of regional uncertainty. However, the approach to risk has become more disciplined,” he said.
According to Kolinko, lenders are carrying out more rigorous assessments, while investors are dedicating additional time to evaluating potential downside scenarios. Legal and restructuring advisers are also becoming involved earlier in transactions.
Due diligence
The changing environment is contributing to stronger demand for independent valuation and technical due diligence services. Archers says this is particularly evident in refinancing and restructuring assignments, institutional acquisitions and transactions involving complex ownership structures.
The trend is also visible in selected mergers and acquisitions, portfolio disposals and sale-and-leaseback transactions, where independent analysis can help support pricing decisions, financing arrangements and overall risk assessment.
Risk focus
Archers notes that valuation uncertainty can increase when market conditions change rapidly but completed transactions have not yet reflected those shifts. Pricing expectations, financing costs, construction expenses, yield requirements and investor sentiment can move faster than transactional evidence, making detailed analysis and professional judgement increasingly important.
Kolinko said that in many sophisticated transactions, the discussion extends beyond headline valuations to include the assumptions, risks and technical factors underpinning them.
At the same time, technical due diligence is becoming more focused on long-term resilience. Investors are paying closer attention to future capital expenditure requirements, operational performance, regulatory risks and environmental, social and governance considerations, alongside traditional assessments of a property's physical condition and compliance status.