Dubai flexible offices expand as AI and hybrid work reshape corporate demand

Dubai’s flexible office market has surpassed 1.2 million square feet, with occupancy rates ranging from 75 per cent to 85 per cent, as businesses reassess their workspace requirements amid changing workplace models and uncertainty over future workforce needs, according to a report by real estate consultancy JLL.

The Middle East & Africa Flexible Workspace Market Report 2026 found that approximately 55 per cent of Dubai’s existing flexible workspace supply has been delivered since 2022, reflecting the sector’s recent expansion.

JLL identified Dubai as the region’s largest and most mature flexible workspace market, supported by a range of locations and pricing options catering to businesses seeking alternatives to conventional long-term office leases.

Despite this growth, more than 90 per cent of corporate real estate portfolios across the Middle East and Africa remain committed to traditional, long-term leases, highlighting the potential for further adoption of flexible workspace arrangements.

Dubai market attracts local and international businesses

Dubai’s flexible office market serves a diverse range of occupiers, from financial and professional services firms requiring private offices to businesses seeking more cost-effective workspace options in locations such as Jumeirah Lakes Towers.

Private offices account for approximately 95 per cent of flexible workspace in Dubai’s central business district locations, reflecting demand from organisations with confidentiality and regulatory requirements.

Local and regional businesses account for around 55 per cent of tenants, while international occupiers represent 40 per cent to 45 per cent. Demand is driven by companies establishing operations, expanding existing businesses and relocating offices.

JLL noted that operators have responded to softer absorption linked to geopolitical tensions by introducing tenant incentives and more flexible lease structures, rather than making substantial rental rate reductions.

Abu Dhabi flexible workspace supply 

Abu Dhabi’s flexible workspace market has reached approximately 366,000 sq ft, with occupancy rates ranging from 70 per cent to 85 per cent, according to the report.

Supply additions during 2024 and 2025 have supported the market’s expansion, while Abu Dhabi Global Market (ADGM) accounts for 57 per cent of flexible workspace operator presence in the capital.

New business establishments are a major source of demand. JLL found that new company setups account for approximately 60 per cent to 70 per cent of flexible workspace enquiries in Abu Dhabi, the highest proportion among the Middle East and Africa markets examined.

International businesses account for around 45 per cent to 55 per cent of demand, pointing to the importance of overseas companies entering or expanding in the capital.

AI adds uncertainty to corporate office planning

Artificial intelligence (AI) and evolving workplace practices are creating fresh challenges for companies trying to determine their future office requirements, JLL said.

Globally, fewer than 5 per cent of corporations allocate more than 10 per cent of their property portfolios to flexible workspace, while more than 40 per cent allocate 1 per cent or less, according to the report.

Dana Williamson, Head of Offices, Business Space and Retail – MEA at JLL, said businesses were facing greater uncertainty about how working practices would evolve over the next three to five years.

“As it becomes increasingly difficult for CEOs to predict what effective working habits will look like in three to five years, for corporate occupiers, flexibility becomes a core strategic tool for mitigating risk,” Williamson said.

She added that the ability of companies to determine the pace and scale of their shift towards flexible workspace would be important in securing a competitive advantage.

Operators are responding to changing demand by expanding meeting facilities, investing in technology and developing services that support hybrid working, the report said.

Landlords and operators reassess workspace strategies

JLL identified opportunities for landlords, developers and workspace operators as flexible offices become a more established part of corporate real estate strategies.

The consultancy recommended that landlords consider partnering with specialist operators through management agreements and revenue-sharing arrangements, allowing them to retain control of their assets while participating in flexible workspace income.

For operators, the report outlined two broad approaches: premium offerings built around prime locations, design and hospitality-led services, or higher-volume models focused on accessible pricing and wider geographic coverage.

For corporate occupiers, JLL recommended moving beyond a binary choice between traditional leases and flexible offices. 

Combining different workspace arrangements could allow businesses to respond more effectively to changes in headcount, working patterns and operational requirements.

The report concluded that flexible workspace is evolving from a niche office option into an established component of corporate real estate strategy across the Middle East and Africa, as businesses seek greater adaptability in an uncertain operating environment.