1. Definition of the area and data structure
Actual location: The WATER’S EDGE property is unambiguously identified according to DLD data and is located in Business Bay. A total of 149 transactions for this building are registered in the DLD database. The analysis is focused on studios (0BR), based on sales and lease contracts from recent years. Where necessary, the same metrics have been aggregated for the wider Business Bay area to enable correct comparison.
2. Liquidity and market structure
Studio sale transactions in WATER’S EDGE have been recorded on a regular basis for at least the last three years (individual quarters with 1–6 deals, with peaks of up to 6 deals in some quarters). On the rental market, liquidity is even higher: over the last 12 months more than 30 studio lease contracts have been concluded in WATER’S EDGE, and over the past few years there have been hundreds of deals. This confirms strong demand both for purchase and for rent; the property enjoys stable, sustained interest.
3. Price dynamics per square metre (purchase)
Over the past three years, the average price per m² for studios in WATER’S EDGE has changed as follows:
– In Q2 2022 the average was about 16,142 AED/m².
– In 2023 the quarterly averages fluctuated between 15,655 and 18,771 AED/m².
– In 2024 the average level reached up to 21,044 AED/m², while the average for the last 12 months stands at 18,601 AED/m².
For comparison, in Business Bay (studios) over a similar time horizon, average monthly prices per m² are higher: over the last 12 months – 28,002 AED/m², with an upward trend particularly visible since 2022.
This indicates that today WATER’S EDGE (studios) is selling at a significant discount to the area – around 33–35% below the average Business Bay price for new/typical studios.
4. Dynamics of average rental rates for studios (per m² per year)
For WATER’S EDGE over the past three years there has been a steady increase in average annual rent:
– In 2022: quarterly range 1,116–1,259 AED/m².
– In 2023: gradual growth, reaching 1,368 AED/m² by year-end.
– In 2024: peak values up to 1,781 AED/m², with a 12‑month average of 1,651 AED/m².
For Business Bay, the comparable figure for the last 12 months is 1,614 AED/m², also with growth, especially noticeable in 2024. Thus, the building is priced by the market at roughly the average district rental level for studios.
5. Comparison of indicators and investment potential (ROI)
The average purchase price over the last 12 months in WATER’S EDGE is 18,601 AED/m².
The average annual rental rate for studios over the same period is 1,651 AED/m².
Estimated current yield (gross ROI):
– For WATER’S EDGE: 1,651 / 18,601 ≈ 8.88% per annum.
– For Business Bay (studios): 1,614 / 28,002 ≈ 5.77% per annum.
As a result, WATER’S EDGE offers a studio yield more than 3 percentage points above the district average, thanks to a relatively low entry price and a mid‑market rental rate. This differentiates the property from competitors and makes it particularly attractive for investment‑oriented buyers.
Taking into account standard transaction costs (fees, commissions, expenses – roughly 7–8% of the entry price), the effective (net) yield will be around 8.2–8.3% per annum for the building (calculation: 8.88% / 1.08 ≈ 8.22%).
6. Fair price range for target yields
For investors targeting a 7–8% annual yield, the fair indicative purchase price range for a studio in WATER’S EDGE (based on actual DLD rental rates) is:
– Range: 1,651 / 0.08 = 20,638 AED/m² (upper bound, targeting 8% per annum);
– 1,651 / 0.07 = 23,586 AED/m² (lower bound, targeting 7% per annum).
The actual DLD sale price is about 18,600 AED/m², which is even below this range and offers a yield above the target interval for investors. This points to sustained demand and potential for some capital appreciation if prices subsequently converge towards district averages.
7. Overall conclusion
In Business Bay, WATER’S EDGE studios demonstrate stable demand and active deal flow in both sales and rentals. The average yield for buyers is almost 3 percentage points above the district average (according to DLD: 8.9% versus 5.8%). Prices are below the fair range for a 7–8% yield, which makes the property attractive for investors seeking high returns with confirmed liquidity. Rising rental rates and transaction volumes, along with strong district dynamics, increase the likelihood of a gradual convergence of the building’s prices towards the area average.
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