1. Definition of the area and data structure
Actual location:
According to DLD, Cayan Tower belongs to the Marsa Dubai area, master project Dubai Marina. All further comparisons and benchmarks are provided for this location.
Factor structure:
The analysis is based on data for studios in Cayan Tower, as well as area-wide data for Marsa Dubai for comparable units. All comparisons use validated aggregates from DLD for the past years.
2. Volume and frequency of transactions, liquidity
The DLD database records at least 18 studio sales in Cayan Tower with quarterly breakdown over the past 3.5 years. Studio transactions have been recorded with high regularity: almost every quarter shows sales, which positively characterises the liquidity of this segment in the building.
The rental market for studios in Cayan Tower is also highly developed: 93 studio lease contracts have been recorded, distributed by years and quarters. This confirms the attractiveness of the asset for rent-focused investors.
3. Price dynamics and price levels per square metre
Purchase (Cayan Tower, studios):
– Over the past 4 years, prices per square metre in studio transactions have been highly volatile, fluctuating in the range of 13,000–29,000 AED/m².
– Since mid-2022, the average price per m² has been steadily increasing, reaching 23,980 AED/m² in the last quarter of 2024.
– The typical size range of studios is 39–73 m².
– The price range per m² within the sample is from 9,466 to 29,049 AED, which confirms dispersion depending on floor and view.
Purchase (Marsa Dubai, studios, area):
– In Marsa Dubai, the price level for studios is noticeably higher: for almost the entire analysed period, average area prices exceed 25,000–35,000 AED/m².
– Over the past 12 months, the area average stands at 32,074 AED/m², which is significantly higher than the average in Cayan Tower (24,059 AED/m²).
Rent
Rental rates:
– In Cayan Tower, the average annual rent for studios over the past 12 months is 1,382 AED/m².
– In Marsa Dubai, it is 1,569 AED/m² for the same period.
Rental growth is evident both for the building and for the area: since 2021, rents in the building have increased from approximately 850–900 AED/m² to the current 1,300–1,500 AED/m².
4. Current market position (12 months)
Average based on actual sales over the past year:
– Purchase price for studios in Cayan Tower — 24,059 AED/m².
– Purchase price for studios in Marsa Dubai — 32,074 AED/m².
Average annual rental rate:
– In Cayan Tower — 1,382 AED/m².
– In Marsa Dubai — 1,569 AED/m².
5. Yield analysis (ROI)
Brutto ROI (Cayan Tower, studios): 1,382 / 24,059 ≈ 5.7%
Brutto ROI (Marsa Dubai, studios): 1,569 / 32,074 ≈ 4.9%
Net ROI adjusted for acquisition costs (≈7%):
– For Cayan Tower: ≈ 5.7% / 1.07 ≈ 5.3%
– For Marsa Dubai: ≈ 4.9% / 1.07 ≈ 4.6%
Both figures reflect actual transaction and rental data, but show that at the current price level it is difficult to expect yields above 5–5.5% per annum even for this specific building, and even more so for the wider area.
6. Fair price range for an investor (target ROI 7–8%)
– For Cayan Tower: to secure a target brutto ROI of 7–8% for the investor, the fair purchase price range for a studio is: 1,382 / 0.08 = 17,275 AED/m², 1,382 / 0.07 = 19,743 AED/m².
– The current average (24,059 AED/m²) is above this range.
– For Marsa Dubai, the analogous “investment-fair” range is: 1,569 / 0.08 = 19,613 AED/m², 1,569 / 0.07 = 22,410 AED/m², which is also significantly below current market prices in the area.
7. Key takeaways
– Liquidity of the asset and of the studio segment overall is very high — both in terms of sales volume and rental activity.
– Since 2022 there has been a sharp increase in both prices and rental rates; however, growth in price per square metre is outpacing rental growth, which is pushing current investment yields down.
– The purchase price of a studio in Cayan Tower is 25% below the area average, which can be an advantage when choosing this building as an entry point, all else being equal.
– Under current market conditions, the entire Marsa Dubai segment does not deliver 7–8% annual returns based on confirmed DLD rates — the price range that would be fair for such an ROI is substantially below current actual transaction levels.
– The 3–5 year outlook remains positive in terms of liquidity, but without new drivers for rental growth or a price correction, the yield potential is constrained to around 4.5–5.5% per annum based on real figures.
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