Market Research

Market Outlook

The UAE Construction Market was valued at USD 66.89 billion in 2024 and is expected to reach USD 96.06 billion by the end of 2030, growing at a CAGR of 6.06% during the forecast period. The UAE’s construction sector, remains robusted supported by government sponsored infrastruture development initiatives, growing inflow of investments in the real estate projects and mega events like the Dubai Expo 2020 (reschuled to 2021) that will have a positive impact on the sector in the long-run. Moreover, the UAE’s “Projects of the 50” campaign aimed at luring more than USD 150 billion in foreign investment over the next 10 years is supporting the construction ecosystem, in particular in Dubai and Abu Dhabi.

Strong demand is being bolstered by population gain and economic diversification plans as part of the UAE Vision 2030, as well as extensive urban development programmes, particularly in the smart city, tourism infrastructure and transport sectors. You have the residential and commercial real estate growing because of the population growth and expats flow, then you have industrial and infrastructure that is growing because government spending is ever increasing. Green building initiative, sustainable urban planning are emerging trends too, indicating the UAE readiness towards sustainability.

The construction and building sector holds a pivotal position within the UAE's broader economic framework, serving as a significant contributor to the nation's diversified Gross Domestic Product (GDP). Non-oil sectors now account for 70% of the total GDP, underscoring construction's crucial role in fostering economic resilience and reducing reliance on hydrocarbon revenues. This strategic importance is further amplified by the sector's direct alignment with the UAE's ambitious national visions and long-term development plans.

Key national strategies, such as the 'We the UAE 2031' vision, aim to double the country's GDP from AED 1.49 trillion to AED 3 trillion. Similarly, the Dubai Economic Agenda D33 seeks to double Dubai's economy by 2033 and solidify its standing among the top three global cities. Achieving these ambitious economic and social objectives necessitates substantial and continuous construction activity across a wide array of segments, from urban development and transportation networks to advanced energy infrastructure and specialized industrial zones. The construction sector is thus not merely a beneficiary of economic growth but a fundamental enabler of the UAE's future aspirations.

Browse Market data Figures spread through 180 Pages and an in-depth TOC on " UAE Construction Market.” - https://www.techsciresearch.com/report/uae-construction-market/4448.html

Macroeconomic and Demographic Foundations

Economic Resilience and Diversification

The UAE's economy demonstrates remarkable resilience and a clear commitment to diversification, providing a robust foundation for the construction sector. Real GDP growth is projected at 4.7% in 2025 and 5.7% in 2026, supported by the strong performance of both non-hydrocarbon and hydrocarbon sectors. The non-oil sector, in particular, has shown significant expansion, registering a 6.7% year-on-year growth in Q4 2023, an increase from 5.8% in Q3 2023. Within Abu Dhabi, the non-oil sector grew by 4.5% over the first three quarters of 2024, surging to 6.6% in Q3 2024, and now contributes over half of the emirate's economy. This shift away from oil dependence indicates a broader base for economic activity, translating directly into increased demand for non-oil related infrastructure and real estate, which are core components of the construction industry.  

Government fiscal policy and strategic budget allocations further reinforce this growth. The UAE federal budget for 2024 stands at AED 64.060 billion, with AED 2.6 billion (4%) specifically allocated to infrastructure and economic resources. Looking ahead, the federal budget for 2025 is projected at AED 71.5 billion, with AED 2.581 billion (3.6%) dedicated to infrastructure and economic affairs. Dubai's commitment to development is even more pronounced, with its 2025-2027 budget cycle, the largest in its history at a total expenditure of AED 272 billion, allocating a substantial 46% of its 2025 expenditures to infrastructure and related construction projects.  

This consistent and substantial government financial commitment acts as a direct stimulus for the construction industry. Increased government allocation directly translates into a higher volume of public sector construction projects, including roads, smart infrastructure, and public services. Beyond direct spending, these budget commitments signal strong government confidence in future economic growth and a stable policy environment. This confidence, in turn, encourages private sector investment, as developers and investors are more inclined to commit capital when foundational infrastructure is provided and a clear long-term vision is articulated. This creates a positive feedback loop where government investment attracts private capital, leading to sustained construction demand. The strategic focus on diversifying the economy means that growth drivers are now broader, necessitating construction in diverse areas like tourism, logistics, digital services, healthcare, and education infrastructure, rather than solely traditional oil and gas related projects. This diversification creates new, resilient revenue streams for the construction sector, making it less vulnerable to oil price fluctuations and fostering innovation in areas like smart building and sustainable construction.

Table 2.1: UAE GDP Growth Rates and Non-Oil Sector Contribution (2022-2026 Projections)

Table 2.2: Federal and Dubai Government Budget Allocations for Infrastructure (2023-2027)

Note: Dubai's 2025-2027 budget cycle has a total expenditure of AED 272 billion and a total revenue of AED 302 billion. The 46% allocation for infrastructure in 2025 refers to the estimated expenditure for that year.

Market Driver Analysis

Population Growth and Urbanization Trends

The UAE's rapid population growth and high urbanization rates are fundamental drivers of construction demand. The country's population is projected to reach 12,190,604 by 2030. As of May 2025, the total population stands at 11.35 million, with expatriates constituting a significant 88.50% (10.04 million) of this total. A substantial portion of the population, 7.28 million people, falls within the 25-54 years age bracket, representing 64.12% of the total, indicating a robust and growing workforce. Dubai alone accommodates 3,943,683 residents, while Abu Dhabi has 3,789,860.

Table 2.3: UAE Population Overview and Projections (2024, 2025, 2030)

Continue reading - (2) UAE Construction Market 2030: Key Projects & Forecasts | LinkedIn

Download Sample Report -  https://www.techsciresearch.com/sample-report.aspx?cid=4448