Quarterly Report Qatar Q3 2024: Office Market Overview

Availability rates fall to their lowest level in Grade A buildings since 2015

Office occupancy in West Bay has climbed to its highest level since 2015 following a series of government/ government-related lease agreements in 2024.

We estimate that approximately 130,000 sq m of gross leasable office space has been leased or reserved in 2024 to date, with take-up mainly split between Msheireb Downtown and West Bay.

Recent activity means that there is now very limited availability in Msheireb Downtown, while we estimate that available office space in West Bay has now fallen to approx. 160,000 sq m, which is less than 10% of total supply. Our research indicates that availability in Lusail’s Marina District in the region of 130,000 sq m.

While occupancy in prime districts is climbing, offices in secondary and tertiary office locations are experiencing higher vacancy rates, with many buildings suffering from prolonged vacancy.

The gravitation towards prime locations and the lack of new demand from the private sector is increasing the gap in rental rates and values between Grade A offices and buildings of lower quality.

Office rents have reduced significantly throughout Doha over the past decade; however, with the increase in occupancy throughout 2024, we expect rents to increase in some prime buildings for the first time since 2015.

Despite some signs of upward pressure on prime office rents in recent months, rents generally remain competitive throughout Doha, with CAT A space available to lease for between QAR 100 per sq m and QAR 140 per sq m per month in West Bay and Lusail, while shell and core offices are available to lease for less than QAR 100 per sq m per month.

In secondary areas, office spaces leased as ‘shell and core’ can be secured for QAR 50 – 60 per sq m per month, reflecting the high vacancy and low demand.

International corporate occupiers are increasingly prioritising sustainability and energy efficient buildings, while few buildings outside of the prime, new office districts are able to meet their requirements. As availability in prime locations reduces, we believe landlords may be incentivised to upgrade the older buildings to meet the requirements of these international corporate occupiers.

Cushman & Wakefield Quarterly Report Qatar Q3 2024

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