1. Definition of the area and data structure
According to the DLD transaction database, a building named D1 appears in two districts. For this analysis, we selected the location with the highest number of transactions — Al Jadaf, master project Jaddaf Waterfront. In this building, both sales and rental data are recorded under the same name D1, and filters are applied to studio apartments (0BR). This is confirmed by the presence of 66 such sales over the entire period and 285 valid rental contracts for studios.
2. Liquidity and activity
Sales: over the past year, 14 studio transactions were concluded in D1. This indicates stable liquidity, especially against the backdrop of more than 400 transactions in the building’s entire history.
Rentals: over the last 12 months, 33 new rental contracts for studios were signed, confirming active turnover of supply and sustained demand for this unit type.
3. Price dynamics over 3–5 years
Price per m² in D1 based on studio transactions:
- During 2020, average prices fluctuated between 12,500 – 15,200 AED/m².
- In 2021, there were minor fluctuations from 13,400 to 14,700 AED/m².
- In 2022, the range remained within 12,000 – 15,300 AED/m².
- In 2023, growth was observed: values reached 16,700 AED/m² (Q4).
- In the latest quarters of 2024, the level exceeds 17,900–21,000 AED/m² (the average over the last year is 17,591 AED/m²).
For comparison with Al Jadaf (studios):
- On average over the past year, transactions were concluded at around 22,780 AED/m², which is higher than in D1 itself.
This indicates that D1 is trading at a discount of about 23% versus the district average. Studio liquidity across the district is significantly higher (899 transactions over 12 months).
4. Rental rate dynamics
- Average studio rent in D1 over the last 12 months is 1,403 AED/m²/year.
- Quarterly dynamics show a gradual increase from 1,236 AED/m² (early 2023) to 1,420–1,430 AED/m² (recent quarters).
Comparison with the district is not possible due to technical limitations of project-level sampling, but Al Jadaf generally shows similar levels in DLD data.
5. Comparison of prices and rents in the building and the district
- Average price per m² in D1 over the year: 17,591 AED.
- Average rent level — 1,403 AED/m²/year.
- In Al Jadaf, the average price per m² is 22,780 AED, while expected rental rates for comparable units are close to the D1 level.
6. ROI and yield calculation
- Gross yield (ROI, brutto) in D1 (studios, last 12 months): 1,403 / 17,591 ≈ 8.0% per annum.
- For the district as a whole, it is not possible to calculate ROI directly due to technical limitations on rental-rate sampling, but the values for D1 are typical for this segment.
Adjustment for net yield (accounting for entry costs of ≈ 8%: DLD fees, brokerage, ancillary costs):
- Net yield (ROI net): 8.0% / 1.08 ≈ 7.4% per annum.
- Indicative investment price: to achieve a 7–8% yield in D1, a “fair” price range for an investor is 17,540–20,040 AED/m² (calculated as rent/0.08 and rent/0.07 respectively; in practice this is rent / target yield).
- Current transactions are taking place at the lower end or slightly below this “fair” range — meaning that, at the time of analysis, D1 looks more attractive than the wider district (where yields are lower due to higher entry prices).
7. Conclusions on the asset and outlook
- D1 (Al Jadaf, Jaddaf Waterfront) demonstrates stable studio liquidity: 14 sales and 33 rental contracts per year is a solid volume for a single building.
- Price and rental dynamics over 3–5 years show moderate growth, and yields at around 8% brutto / 7.4% net remain attractive for investors compared with the district, where similar units are noticeably more expensive.
- Over a 3–5 year horizon, the building should retain its liquidity and investment appeal, assuming no market overheating. If competition in the district increases, a moderate price discount versus the district benchmark is possible.
- Both buyers and sellers can reasonably focus on prices close to current levels, targeting a 7–8% annual yield.
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