The cranes aren’t slowing down. From new towers piercing the skies of Dubai to mega-infrastructure reshaping Abu Dhabi, the UAE’s construction engine is charging ahead with output expected to hit $130.8 billion by 2029—up 22% from 2024 levels, according to new industry projections.
The sector has been on an unstoppable climb since the start of the decade, hitting a record $107.2 billion in 2024. Forecasts now point to steady annual growth of about 4% through the end of the decade, keeping construction at the heart of the country’s development pipeline.
Construction accounts for nearly two-thirds of all planned projects in the Emirates, dwarfing transport, power, and water investments. Mixed-use mega-developments dominate the blueprint at 42%, followed by residential (28%), data centres (9%), and hospitality (4%).
The Price of Building Dreams
Costs remain steep but varied. As of mid-2025, building a standard villa runs at roughly AED 4,200 per square metre, with luxury villas surging to AED 11,000. Apartments average between AED 4,300 and AED 9,500, while commercial construction falls in the AED 5,500–7,300 range.
Dubai vs. Abu Dhabi: Contrasting Playbooks
Abu Dhabi and Dubai together account for 85% of all contracts awarded over the past five years—$151 billion in Abu Dhabi and nearly $130 billion in Dubai. But their priorities differ. In Dubai, 75% of awarded projects are in construction, while oil and gas barely register at 3%. Abu Dhabi tells the opposite story: 40% of contracts lean toward oil and gas, with construction at just 23%.
Yet both cities are laying down ambitious foundations. Dubai is extending its Metro with a new Blue Line and rolling out lifestyle megaprojects from Palm Jebel Ali and The Oasis to Therme Dubai and Venice at DAMAC Lagoons. Abu Dhabi, meanwhile, is banking on transformative transit links—a 150-km high-speed train to Dubai by 2030 and a 131-km Metro project to serve its swelling population.
Rising Demand, Tight Supply
The surge in population is shaping the market as much as infrastructure. Dubai expects to grow from 3.4 million residents in 2020 to 5.8 million by 2040, fuelling relentless demand for housing and office space. By 2028, 8.2 million square feet of office stock will come online, though analysts warn demand will still outpace supply.
Abu Dhabi is also in expansion mode, with over 33,000 residential units under construction for delivery by 2029—71% of them apartments. Its office market is poised for a wave of completions in 2027, with nearly 175,000 square metres set to hit the market after modest supply in the preceding years.
The Bigger Picture
These projects align with national agendas—Dubai’s D33 Economic Agenda, the UAE’s 2031 vision, and Abu Dhabi’s 2030 plan—each designed to double economies, diversify away from oil, and cement the country as a magnet for global investment.
The results are already showing. Dubai is the busiest $10 million homes market in the world, with residential prices sitting 22% above their 2014 peak. Hotels in the emirate are running at occupancy rates topping 81%, among the highest globally, while its airport continues to hold the crown as the world’s busiest for international travel.
In short, the skyline is far from finished. By 2029, the UAE will not just be building bigger—it will be building smarter, denser, and faster, transforming its cities into global benchmarks of urban ambition.
