Dubai closed 2025 with AED 917 billion in property transactions — and only three REITs

Dubai closed 2025 as the most active property market in the world — over 270,000 transactions worth AED 917 billion, up 20% year on year. In H1 alone, 95,000 investors deployed AED 326 billion, and the market kept growing straight through regional conflict. June brought a fresh wave of developer launches. The volume is there. The investment infrastructure hasn't caught up.

Over 90% of Dubai property transactions still come from individual buyers and HNWIs purchasing directly. There are only three listed REITs on Nasdaq Dubai, and together they represent a fraction of the market's total value. Compare that to New York, where roughly 60% of transactions are direct purchases and the rest flows through REITs, private equity funds, institutional investors, and securitized products. Around 60% of the top 25 North American institutional investors use REITs as part of their allocation strategy.

Dubai has the volume of a mature market. Not the channels.

Direct buyers and institutional capital behave differently, and a market's channel mix says as much about its maturity as its transaction count does. Dubai's mix is still overwhelmingly direct.

Each channel plays a different role. Direct buyers respond to sentiment — a strong launch, a good quarter, a well-timed price cut. Institutional capital responds to fundamentals — occupancy, yield, replacement cost. Dubai currently runs almost entirely on the first kind.

The REIT gap, in one IPO

In January 2025, Dubai Holding listed the emirate's first residential REIT on Nasdaq Dubai. The IPO raised $584 million. Orders exceeded $15 billion.

That's not a demand problem. Investors want exposure to Dubai real estate through listed, liquid, regulated vehicles — there simply aren't enough of them to buy.

"Individual buyers follow sentiment. Institutional capital follows fundamentals. A market needs both layers to hold steady."

What comes next

Three listed REITs and one blockbuster IPO look like the opening move, not the endpoint. The channels most likely to follow:

Private equity real estate funds. Pooled institutional capital targeting specific asset classes — logistics, hospitality, master-planned residential — without listing requirements.

Exchange-traded funds on property indices. Liquid, exchange-listed exposure to a basket of Dubai real estate assets rather than a single building.

Structured notes linked to real estate performance. Fixed-income-style products with returns tied to property indices or rental-yield benchmarks.

Developer bonds. Debt markets replacing presale cash flow as the primary way developers fund construction — a shift already underway among the larger state-backed names.

Fractional ownership platforms. Tokenized or shared-title structures that let investors buy a slice of a unit rather than the whole thing.

Why the gap matters — for investors, developers, and the market

One. For investors, these channels mean access without buying a whole unit — a lower capital barrier, more liquidity, and regulatory oversight that a direct off-plan purchase doesn't carry.

Two. For developers, institutional capital funds cluster-scale construction — master communities, shared infrastructure, long-term phased delivery — rather than one tower financed unit by unit through presales.

Three. For the market, it means depth. Individual buyers follow sentiment; institutional capital follows fundamentals. A market running on both layers together carries less volatility than one running on either alone.

The supply picture could still shift as developers recalculate construction economics against a changing rate environment. But the structural move toward institutional channels — REITs, funds, bonds, fractional platforms — looks permanent, not cyclical. Dubai has already proven it can generate volume. What happens next is about how the money flows in.