Two thousand new companies a day: Dubai’s business activity in numbers

Some indicators say more about a property market than the market itself does. The number of registered companies is one of them.

The numbers

• 191 013 certificates of origin issued by the Dubai Chamber of Commerce in a quarter — 7% more than a year earlier.
• About 2 122 new enterprises a day on that basis.
• By another estimate for the same period, around 250 companies of various sizes were registered daily in the emirate — the figures refer to different types of registration but describe the same order of business activity.

Why this beats forecasts

A forecast of office demand can be built however you like. A company that has registered, on the other hand, sooner or later needs a physical address: for its licence, for hiring, for bank compliance. That is not an intention but an obligation stretched over time.

That mechanism explains why office vacancy in Dubai holds at a few percent while few new office projects are launched. Demand is generated by the registry, not by advertising.

What follows

For an office investor this is the most reliable indicator of medium-term demand — more useful to track than quarterly transaction reports. For the residential segment the mechanism is the same with a lag: companies hire people, and people rent homes.

One caveat: a significant share of registrations are micro-businesses and free zone companies for whom a flexi-desk or a small serviced office is enough. Converting registrations straight into square metres overstates the effect.