Aldar deepens Dubai rental push

Aldar Properties has bought a residential and community retail project in Dubai Studio City for AED1.1 billion, marking a fresh step in the Abu Dhabi developer’s push to expand its recurring income base in Dubai’s fast-growing rental market.

The acquisition from private developer SRG will give Aldar a build-to-rent community scheduled for completion in 2028. The project is planned around 312 homes across six mid-rise buildings, supported by a community mall and 39 retail units designed to serve residents and neighbouring districts. The transaction is among the largest mixed-use property deals in the UAE this year and sets a new benchmark for Dubai Studio City, a district that has evolved from a media and production cluster into a broader residential corridor.

Aldar’s move reflects a clear shift in strategy from selling homes alone to owning income-producing assets that can generate stable rental returns over the long term. The company has been widening its Dubai presence through development launches, acquisitions and partnerships, while retaining Abu Dhabi as its core market. Its investment arm already holds assets across residential, commercial, logistics, retail and mixed-use categories, giving the group a more diversified earnings base than a conventional homebuilder.

The Dubai Studio City project is being positioned as an integrated rental community rather than a traditional strata-sale development. Build-to-rent projects remain a smaller part of the UAE housing market compared with owner-occupied or investor-owned apartments, but demand has been rising as higher rents, population growth and changing work patterns push developers to consider professionally managed rental housing. The model allows an owner to retain control of the asset, manage service standards and capture rental growth instead of selling units individually.

Dubai’s residential market has remained one of the strongest in the region, supported by population inflows, business expansion, tourism, long-term residency reforms and sustained demand from expatriate professionals. Rental increases have moderated in some areas after sharp gains in earlier years, but well-located communities with good access to employment hubs, schools, retail and entertainment venues continue to draw tenants. Dubai Studio City benefits from proximity to Motor City, Arabian Ranches, Dubai Sports City and the wider Al Qudra and Sheikh Mohammed bin Zayed Road corridors.

For Aldar, the deal adds scale in a market where competition among major developers has intensified. Dubai Holding’s enlarged stake in Emaar has reinforced the central role of large, well-capitalised property groups in shaping the emirate’s development cycle. Emaar, Dubai Holding, Nakheel, DAMAC, Sobha, Binghatti and other private developers remain active across luxury, mid-market and branded residential segments, while Aldar has been building a more selective position through projects aimed at both buyers and renters.

Aldar entered Dubai’s development market through a partnership with Dubai Holding and has since expanded its pipeline with projects including Haven, Athlon and The Wilds. Its Dubai activity has been aimed at capturing demand from overseas buyers and residents seeking master-planned communities with stronger amenities and more structured management. The Studio City acquisition adds a rental-led component to that platform, balancing sales-driven development revenue with recurring income.

The company’s first-quarter 2026 performance provides financial backing for the expansion. Net profit after tax rose 20 per cent year on year to AED2.3 billion, while revenue reached AED8.7 billion and EBITDA climbed to AED3 billion. Group sales stood at AED6.7 billion, with UAE sales contributing AED5.9 billion. Overseas and expatriate resident customers accounted for AED5.3 billion of UAE sales, underscoring the depth of demand from buyers outside the traditional local base.

The project also fits a broader regional pattern in which developers are using rental housing, logistics, offices and community retail to reduce exposure to cyclical off-plan sales. Rising interest rates in earlier years, tighter affordability for some buyers and a large delivery pipeline have encouraged developers to look for income streams that are less dependent on launching and selling new projects. Build-to-rent assets can also appeal to institutional investors seeking predictable cash flow in a market where professionally managed residential portfolios remain relatively limited.