The UAE’s office markets are among the tightest in the world.
Grade A space in Dubai and Abu Dhabi is running at 95%+ occupancy, and rents are climbing. For global corporates consolidating or expanding in the region, securing space has become a strategic priority. Yet in the rush to relocate, too many occupiers misjudge the true cost of moving. Beyond headline rent, there are hidden pressures that can derail budgets and delay timelines.
1. Licensing and Regulatory Friction
The first surprise usually comes from regulation. Moving between freezones or into the mainland can mean amending or duplicating licenses. Shifts into hubs like DIFC or ADGM often require a new legal entity, compliance approvals, and added fees.
In some districts, tenants face dual licensing. Expo’s dual authority model, for example, requires companies to pay both DED visa fees and freezone permits, creating ongoing cost duplication. These expenses are rarely captured in initial relocation models but can materially affect project viability. They also stretch timelines, delaying fit-out and occupancy.
2. Fit-Out and Compliance Upgrades
Most landlords deliver either shell-and-core or CAT A space. The burden of CAT B fit-out sits with the tenant, and costs are climbing. Compliance with Dubai’s green standards (LEED or Estidama), fire safety systems, and IT infrastructure upgrades typically add 20–30% to budgets.
The gap between old and new stock is stark. Premium towers such as ICD Brookfield, One Za’abeel, and One Central are designed to modern standards, reducing long-term operating and compliance costs. Older buildings, by contrast, often need significant upgrades in ventilation, power capacity, or digital infrastructure before they can meet occupier expectations. That difference should be quantified early, ideally with benchmarking from contractors or project managers, rather than discovered mid-build.
3. Downtime and Business Disruption
Relocations aren’t just about real estate, they disrupt operations. Migrating IT systems, preparing staff for the move, and running parallel leases all carry hidden cost. In today’s tight market, tenants frequently need to commit to a new lease before their existing one expires, leading to months of double rent.
Risks multiply when the new building isn’t delivered on schedule, a common challenge in the region. Delays at completion can leave companies paying for temporary swing space or idle fit-out teams, with productivity losses compounding the financial hit. Few relocation budgets model this exposure, but it can run into millions for larger corporates.
4. Service Charges and Ongoing Occupancy Costs
Headline rent is only part of the equation. Service charges, parking, utilities, and security deposits all add weight to the bottom line. In prime hubs like DIFC and ADGM, service charges can materially increase occupancy costs over the lease term. Legal fees - particularly if external counsel is involved - also catch many occupiers off guard. Broker fees, while more predictable, still need to be factored in at the budgeting stage.
Even small line items accumulate. A relocation designed to cut costs can end up increasing the all-in “cost to occupy” if these outlays are missed in the planning stage.
Looking Ahead: Managing the Real Cost of Relocation
The UAE remains one of the most attractive office markets globally: connected, talent-rich, and business-friendly. But occupiers who look only at base rent risk underestimating what it really takes to move.
The solution is not to avoid relocation, but to plan it with eyes wide open and understand all that it entails. That means quantifying regulatory exposure, testing fit-out assumptions, finding and procuring the right partners, stress-testing timelines, and scrutinising service charges upfront. Advisory teams - particularly Project & Development Services (PDS) - can play a critical role in this process. By helping clients understand realistic exposure before they are over-committed – from benchmarking fit-out costs and sequencing contractors, to negotiating service-charge transparency - PDS teams reduce the risk of expensive surprises.
Relocations in the UAE can unlock efficiency, profile, and talent advantages. They can be value-accretive. But only if hidden costs are mapped, managed, and mitigated before the first box is packed.
