ROI analysis of apartment in Sky Bay Hotel: DLD data and real deals — 01.12.2025

1. Definition of the district and data structure

Actual location: According to open DLD data, the Sky Bay Hotel building is located in Business Bay and is part of the Business Bay master project. Sales data for this property in DLD is recorded under the name SKY BAY HOTEL. The DLD database for this asset (SKY BAY HOTEL) shows no transactions for classic apartments (flats), and there are no registered 2-bedroom apartments. The bulk of transactions relates to hotel rooms classified as Hospitality (Hotel Rooms). There are also recorded deals for office and retail units. There is no residential rental data for the building in DLD; only one commercial lease (restaurant) is recorded, which makes it impossible to analyse rental rates for hotel rooms or apartments.

2. Transaction dynamics and pricing for the building

A total of 471 transactions have been registered for the SKY BAY HOTEL building, of which 447 relate to hotel rooms (Hotel Rooms). Historically, the main volume of deals was recorded between 2020 and 2023. The average size of a hotel room involved in a sale ranges from 22–48 m². Analysis of the dynamics of the average price per square metre for hotel rooms shows the following benchmarks:
– In 2020–2021, the average price level for rooms was 35,000–42,000 AED/m².
– In 2022, the average figure remained at a similar level, with individual quarters showing values of 37,900–41,000 AED/m².
– In 2023, volatility is observed: the average price per m² fluctuated from 36,000 to 43,400 AED/m².
– Over the last 12 months (as of the date of the sample), the average transaction price for a hotel room in SKY BAY HOTEL amounted to 31,990 AED/m².

Overall, over the past 4–5 years there is a visible trend towards a decrease in the average price per m² for hotel rooms, which may be related to market correction or a gradual concentration of sales in smaller-size units.

3. Comparison with the district’s residential property market

For the residential apartment market in Business Bay, according to DLD data for the last 12 months, the average price per square metre stands at 25,220 AED/m² (transactions relate only to residential assets – apartments/flats in the Residential segment). The average price at SKY BAY HOTEL (31,990 AED/m²) is approximately 27% higher than the district average for residential apartments.

It is important to stress: a direct comparison between the cost of hotel rooms and apartments is not correct in terms of product positioning and DLD standards; however, correlating them allows us to record the price premium of hotel units over classic residential property in the district.

4. Rental and yield

There are no registered residential rental contracts or hotel apartment leases for this building. All rental data for SKY BAY HOTEL in DLD consists of a single commercial lease (restaurant). Therefore, it is impossible to determine the market rental level for the building or to calculate ROI (gross or net yield) based on DLD. For Business Bay as a whole, an average annual rental level for apartments (flats) also cannot be substantiated without an aggregate query, as only sales data is available.

It should be clearly stated: any numerical estimates of rental levels, potential income, or investment attractiveness in terms of yield are unacceptable in the absence of valid DLD contracts for this asset class.

5. Liquidity and market outlook

The transaction volume for hotel rooms in the building is high and evenly distributed by quarter: dozens of sales are registered each year, indicating sustained buyer interest in this type of asset. From a resale-market perspective, liquidity can be considered solid; however, an investor must factor in the specifics of hotel room management, restrictions on independent operation, and potential service charges. Fluctuations in the average price per m² over 4 years have been within ±12%, which demonstrates a certain level of volatility in this niche.

Across the Business Bay market, the aggregate liquidity of residential properties is significantly higher, as evidenced by thousands of registered transactions annually and a wide price range. For an investor focused on classic rental and ownership of a straightforward asset (apartment/flat), this segment may appear more predictable.

6. Comparison of price_per_sqm for an apartment/hotel room in the building and the district, investment gap

– Average price for a hotel room in SKY BAY HOTEL: 31,990 AED/m² over the last 12 months.
– Average price per m² for a residential apartment in Business Bay: 25,220 AED/m² over the same period.

The SKY BAY HOTEL premium to the district average for apartments is around 27%. Without confirmed DLD rental rates, it is impossible to determine a fair price range for achieving a 7–8% annual yield or to calculate ROI-brutto and ROI-net.

7. Investor conclusions

Sky Bay Hotel is a mature and liquid asset in the hotel room segment of Business Bay, with regular sales of compact units. However:
– As of mid-2024, DLD has no data on the rental of hotel rooms or residential apartments in the project, nor generally for other hotel complexes in the district.
– Any calculations of potential profitability (gross yield, net yield) are impossible without actual DLD data on rental rates specifically for this segment.
– When purchasing, an investor should be guided by the current price trend (around 32,000 AED/m²), taking into account the premium to residential apartments in the district, as well as the specifics of hotel room management and the potential volatility of this market.