1. Definition of the area and data structure
Actual location: according to the DLD database, the building THE 118 belongs to the Burj Khalifa area and is part of the DownTown Dubai master project. The benchmark location for comparison is the Burj Khalifa area, which is highlighted in DLD data as a separate location.
For the latest analysis, 67 sale transactions and 78 lease contracts are available for THE 118, which allows for both qualitative and quantitative comparison with the dynamics of the wider area.
2. Price dynamics and distribution (sales)
For THE 118, apartment sales have been recorded every quarter since 2020; sales volumes have fluctuated significantly in line with rising demand. Over the past 12 months, the average purchase price amounted to AED 40,205 per m², which is 47% higher than the average price in the Burj Khalifa area (AED 27,255 per m²).
The long-term trend for THE 118 shows a marked increase from average levels of AED 24,000–33,000 in 2020–2022 to AED 36,000–50,000 per m² in the most recent quarters of 2024. Prices in THE 118 significantly exceed the typical level in the area, where the Burj Khalifa average over the last 2 years has fluctuated in the AED 22,000–25,000 per m² range, while in THE 118 individual purchases have exceeded AED 40,000–60,000.
In terms of the number of transactions, the building can be classified as a liquid club residence with active sales at the premium tier of the Downtown market.
3. Rental rate dynamics and distribution
THE 118 is in a mature operational phase: a total of 78 lease contracts have been concluded over the past few years, with rental rates increasing against the backdrop of a more active market. The annual rent per m² in THE 118 over the last 12 months has averaged AED 2,586, which is 62% higher than the Burj Khalifa area benchmark (AED 1,597 per m²).
Over time, rental rates in the building have grown rapidly: while in 2020–2021 they stood at AED 950–1,000 per m², by 2023 they exceeded AED 1,600–2,100 per m², and in the latest quarters we see stable levels of AED 1,600–2,500 per m². The Burj Khalifa area also shows positive dynamics, but from a lower base: from around AED 800 per m² in 2020 to AED 1,400–1,600 by 2024.
The distribution for THE 118 is shifted into the premium segment, and liquidity is confirmed by a steady flow of new contracts (3–6 deals per quarter).
4. ROI comparison and “investment fair value”
The brutto ROI for THE 118 over the last 12 months is at 6.4% per annum, based on actual rental and sale transactions. For Burj Khalifa, ROI is around 5.9%, meaning that THE 118 is attractive as a cap-rate investment asset specifically within the prime segment.
Taking into account standard entry transaction costs (around 7%), the net yield for a buyer in THE 118 decreases to 5.9% (brutto ROI / 1.07). For the area as a whole, it drops to 5.5%. This level is in line with average market expectations for club-class prime stock in Downtown.
For an investor targeting a 7–8% annual yield, the fair price range for THE 118 is AED 32,000–37,000 per m² (given an average rent of AED 2,586 per m²). Actual sales over the last 12 months significantly exceed this range, meaning the current market values the asset more as a trophy asset than as an income play. For the wider area, the fair corridor is AED 20,000–23,000 per m², which almost coincides with current market sale prices.
5. Key conclusions and outlook
THE 118 is a flagship premium building in the heart of Downtown with above-average liquidity for the trophy assets segment, outpacing growth in price per m² and stable rental demand. The building is significantly more expensive than typical apartments in Burj Khalifa (by 47%) and outperforms the area in rental income (by 62%). This makes the asset unique; however, at current prices the payback is slightly below what a classic yield-focused investor would prefer, and at an entry level above AED 40,000 per m², rental rates need to be close to the building’s historical maximum to achieve a 7–8% ROI.
Conclusion for an investor: entering at current prices is justified either for buyers focused on a trophy portfolio and capital preservation in a top Downtown location, or for strategies with a long-term capital appreciation horizon rather than high short-term yield. The outlook for THE 118 remains attractive due to the building’s scarcity and reputation, but the entry yield at current prices is below the target 7–8% corridor.
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