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Apartment prices on Yas Island and Al Reem Island climbed about 18 percent over the past year, as Abu Dhabi's residential market continued to record strong growth despite signs of easing activity in the emirate's office sector. A new report by property consultancy Knight Frank found that waterfront communities remained among the strongest-performing residential markets in the year to June 2026, while office leasing transactions fell 13 percent in the first half of the year, marking the first annual contraction in the current market cycle.
Where Prices Are Highest
Al Saadiyat Island remained Abu Dhabi's most expensive apartment market, with average transaction prices reaching Dh43,100 per square metre, up 21 percent from a year earlier. In the villa segment, Al Jubail Island recorded the strongest annual price growth of around 40 percent, while Al Saadiyat Island retained its position as the emirate's most expensive villa location, with average transaction values of Dh26,500 per square metre.
- Yas Island, Al Reem Island apartment prices: +18% year-on-year
- Al Saadiyat Island apartment prices: Dh43,100/sqm, +21% year-on-year
- Al Jubail Island villa prices: +40% year-on-year
- Al Saadiyat Island villa prices: Dh26,500/sqm
- Homes under construction (2026-2030): ~36,900
What's Coming Through the Pipeline
Knight Frank said Abu Dhabi has around 36,900 homes under construction between 2026 and 2030, with apartments accounting for two-thirds of the pipeline. Around 70 percent of new apartment supply is expected to be delivered in 2026 and 2027, although construction cost pressures and higher shipping insurance costs could lead to delays. Yas Island accounts for the largest share of upcoming residential supply, with around 7,700 units under construction, followed by Fahid Island with 3,550 units and Saadiyat Island with 3,250 units.
Also Read: Aldar Launches The Orchids At Yas Acres In Abu Dhabi
Office Leasing Cools
While the residential market remained resilient, the office sector showed early signs of cooling. Office leasing transactions totalled about 23,616 in the first half of 2026, down 13 percent from the same period a year earlier. The decline was recorded across most districts, although Al Reem Island stood out with leasing activity surging by more than 148 percent. Knight Frank expects about 428,000 square metres of new office space to be delivered between 2026 and 2028, with most of the supply entering the market over the next two years, which the consultancy said could put upward pressure on vacancy rates when combined with softer leasing demand.
What Analysts Are Saying
Faisal Durrani, Partner and Head of Research, MENA at Knight Frank, said despite the geopolitical challenges posed by the ongoing regional conflict, Abu Dhabi's residential market continues to be supported by robust domestic demand, with prime waterfront communities such as Al Saadiyat and Yas Island leading the emirate's price growth.
Shehzad Jamal, Partner, Real Estate Consultancy, MENA, said that with close to 37,000 homes in the pipeline through to 2030, supply is beginning to catch up with several years of sustained demand, though the concentration of new stock in a handful of master-planned communities means well-located, ready properties in areas like Al Saadiyat and Yas Island are likely to retain their premium.
James Hodgets, Partner, Occupier Strategy and Solutions, MEA, said the outlook for Abu Dhabi's office market remains firmly positive, with occupancy at around 98 percent and rental rates up year-on-year, adding that with only around 166,000 square metres of new supply due in 2026, Grade A space will remain scarce.
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