Red Flags to Watch When Investing in Commercial Real Estate in Dubai
Dubai’s skyline is stunning, and commercial properties can look equally attractive. But before you sign on the dotted line, watch out for these common traps:
1. Unrealistic ROI Promises
If someone’s promising guaranteed 10-15% returns with zero risk… alarm bells! In real estate, higher the return, higher the risk. Always verify.
2. Free Zone Confusion
Free zones aren't a free-for-all. Make sure your property type aligns with licensing requirements. Some tenants may be restricted from operating there.
3. Hidden Service Charges
That “attractive” AED/sqft rental might come with sky-high service charges. Ask for the net return, not just the rental income.
4. Overleveraged Sellers or Distress Deals
A desperate seller might sound like a great deal… until you realize the tenancy isn’t secure or documentation is a mess. Always check title deeds, tenancy contracts, and pending dues.
5. Tenancy Illusions
“Rented property” sounds great… but is the tenant reliable? Is it a renewed contract or just a short-term filler? One vacant unit can ruin your return math.
Quick tip: Glossy brochures don’t pay your EMIs. Solid research and local market understanding does.
Seen any red flags in your journey? Let’s make investing smarter, together. Share your experience below.