Aviation boom fuels real estate surge: UAE's airports set new benchmarks in urban development
Experts and analysts said the airports' development is a catalyst for extensive real estate growth in the surrounding areas as it drives demand for residential and commercial properties, including hotels, offices, and retail spaces catering to the needs of travellers and businesses. They opined that proximity to a major airport enhances property values, making the region attractive to investors and developers.
'Airport often acts as catalysts for regional development, attracting businesses, investors, and residents seeking proximity to enhanced transportation options. Land prices near airports appreciate rapidly as investors anticipate growth and this trend lifts demand for various types of real estate properties in the country,' experts said.
Latest data indicates that airports in the Asia-Pacific and Middle East region will invest $240 billion to expand capacity, modernise infrastructure, and support future passenger and cargo growth.
In the post Covid-19 era, construction of new airports and expansion of existing facilities are in full swing as there has been a resurgence in air travel across the globe.
Aviation Role in Realty Boom
The UAE is known for its thriving aviation industry, with some of the busiest airports in the world serving millions of passengers every year. The government accords priority to expand major airports of the country to handle a big boom in air travel until 2030 by investing in aviation infrastructure and services.
The UAE, which aims to host 40 million visitors by 2031, is implementing a multi-billion dollar airport development and expansion project that will help the airports to handle more than 300 million passengers annually. The emirate has also outlined plans to build new airports and expand existing ones to stay competitive as a global aviation hub.
Strategic planning ensures sustainable growth, positioning the UAE as a global hub while transforming its real estate landscape with vibrant, mixed-use communities. The UAE's ambitious airport development and upgrade projects, particularly in Dubai and Abu Dhabi, significantly reshape its real estate sector. The emirate's airports are expanding in a fast-forward mode to welcome an estimated 150 million passengers this year compared to 140 million in 2024, according to the experts.
DWC to Redefine Urban Living
Elaborating, they said the $35 billion expansion of Dubai World Central (DWC), set to become the world's largest airport, and upgrades to Dubai International (DXB) — which welcome 92.3 million record passengers in 2024 — and Abu Dhabi's Zayed International Airport, which handled 29.4 million passengers last year, drive economic growth and property demand and will set new benchmark in urban living. These projects enhance connectivity, attracting global businesses, tourists, and residents, which boosts commercial real estate, including logistics hubs, warehouses, and office spaces near airports.
For instance, Dubai South's 'airport city' integrates residential, retail, and hospitality developments, projecting a 15-20% rise in property values due to job creation and infrastructure improvements like roads and metro links. In addition, residential demand surges in Dubai South, Dubai Investment Park, Expo City and other areas as more people flock to the emirate in search of better future.
'Upon completion of expansion project, Al Maktoum International Airport is anticipated to be bigger than Dubai International with 250 million passenger capacity. And real estate sector will be among major beneficiaries of the mega project,' says an analyst.
Transforming Abu Dhabi Landscape
Similarly, Abu Dhabi's airport upgrades support tourism and trade, spurring hotel and retail developments. The airport's sustainable design and global hub status align with Abu Dhabi's Vision 2030, transforming the real estate landscape into vibrant, mixed-use communities.
The $3.3 billion expansion of Zayed International Airport, formerly known as Abu Dhabi International, particularly the 2023 opening of Terminal A, significantly impacts Abu Dhabi's real estate sector. Designed to handle 45 million passengers annually by 2030, the terminal enhances connectivity, boosting tourism and trade. This drives demand for commercial real estate, with logistics hubs, warehouses, and offices thriving in areas like Khalifa Economic Zones Abu Dhabi (Kezad), where warehousing rents rose 14% in first quarter of 2025.
Retail and hospitality sectors also benefit, with hotels and shopping centres catering to increased passenger traffic. Residential demand surges in luxury areas like Yas Island, Saadiyat Island, and Al Reem Island, where apartment prices up 2.54% to 5.23% in January-March 2025 quarter, fuelled by job creation and infrastructure improvements like Etihad Rail stations.
Sharjah: A Sustainable Hub
Sharjah's real estate sector is also transforming into a diversified, sustainable hub, fuelled by its airport's ambition to rank among the top five regional airports. The $654 million Sharjah International Airport expansion, set to increase passenger capacity from eight million to 25 million by 2027, is significantly impacting Sharjah's real estate sector. The airport welcome 17.1 million passengers in 2024.
The project, which includes a new terminal, additional gates, and infrastructure upgrades, enhances connectivity, driving demand for commercial and residential properties. Some of the areas have already been seeing high transaction volumes, benefit from improved accessibility and economic activity.
Moreover, commercial real estate, particularly office spaces and logistics hubs, is thriving, with occupancy rates exceeding 70% and prime rents rising 40% due to corporate relocations. Residential demand also grows in nearby areas, supported by job creation and infrastructure developments like roads, hotels, shopping centres and entertainment facilities.
'Dubai and GCC airports are already known for their passenger-centric design, new technology adoption and commitment to value creation, and we see a strong alignment with WAISL's philosophy of creating predictive, AI-driven NextGen airports with a superior RoI framework,' Preetham Kamesh, Strategic Advisor & Acting Global Business Officer, WAISL Limited.
Major Projects in the Region
As the UAE is implementing major airport projects, Saudi Arabia and other countries in the region also executing the policies to either develop new development or upgrade the existing facilities. As it targets 300 million passengers by 2030, Saudi Arabia is constructing a multi-billion mega hub in Riyadh, King Salman International Airport, which it also wants to ultimately become the world's largest airport for passenger capacity upon its completion in 2030.
In Oman, Musandam Airport is being constructed for $250 million and is expected to be ready by fourth quarter of 2026. Bahrain is working at a project to develop a 40-million-passenger capacity international airport terminal that will replace its existing hub.
In Kuwait, a new triangular terminal with 28 gates is expected to become operational in 2025-26. By 2040, airports in the Middle East will handle 1.1 billion passengers, more than double the 2019 figure of 405 million passengers.
Schneider Electric's President of Gulf Countries, Amel Chadli, remarked that as the aviation industry in the Middle East experiences unprecedented growth, our strategic objective is to empower airports to scale efficiently — with intelligent, secure, and resilient systems that elevate the passenger experience, and we are helping airports around the world reduce their environmental impact.
Sascha Goly, Global Segment Manager Logistics, Forbo Movement Systems, remarked that the MEASA region is where airport infrastructure is growing rapidly and sustainability is becoming a major focus.
Scaling Real Estate Growth
Experts are of the view that airport development typically stimulates infrastructure improvements, including roads, public transport, and utilities. These enhancements not only improve accessibility to the airport but also attract residential developments. As transportation costs decrease and commuting times shorten, suburban areas near airports become more appealing for families and professionals, thereby driving residential real estate development.
'While airport development can lead to increased real estate activity and economic benefits, it necessitates careful planning and community engagement to mitigate its negative impacts. Stakeholders must evaluate the opportunities associated with airport-related real estate development to ensure sustainable growth that benefits all parties involved.'
In conclusion, experts have a consensus that airport development acts as a catalyst for real estate growth, but its success depends on strategic planning, sustainable practices, and balancing economic gains with community needs. The ripple effects transform regions, making them more competitive while reshaping urban landscapes.
UAE Airports Expansion at a Glance
The UAE airports will handle
more than 145 million passengers this year compared to 140 million in 2023.
Zayed International Airport is now able to handle 45 million passenger annually.
The current capacity of Dubai International can reach up to
120 million passengers.
Upon completion of expansion project, Al Maktoum International Airport is anticipated to be bigger than Dubai International with
250 million passenger capacity.
Sharjah International Airport will be able to handle up to
25 million passengers by 2027.
Setting New Benchmarks in Urban Living
The UAE's ambitious airport development and upgrade projects, particularly in Dubai and Abu Dhabi, significantly reshape its real estate sector.
Dubai South's 'airport city' integrates residential, retail, and hospitality developments, projecting a 15-20% rise in property values due to job creation and infrastructure improvements like roads and metro links.
Zayed International Airport's sustainable design and global hub status align with Abu Dhabi's Vision 2030, transforming the real estate landscape into vibrant, mixed-use communities.
Sharjah's real estate sector is also transforming into a diversified, sustainable hub, fuelled by its airport's ambition to rank among the top five regional airports.
The Asia-Pacific and Middle East region will invest $240 billion to expand capacity, modernise infrastructure, and support future passenger and cargo growth.
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