UAE construction market shows resilience amid rising costs

DUBAI (MNTV) — The UAE’s construction sector is gaining steady momentum despite rising costs and labor shortages, according to a new Turner & Townsend market intelligence survey for 2025.

The report revealed that 71 percent of contractors, consultants, and developers described the market as “warming,” citing ongoing growth across real estate, infrastructure, and tourism, reflecting a two percent increase from last year’s outlook.

Respondents noted that residential, mixed-use, leisure, and major public infrastructure projects continue to dominate development activity, underscoring the UAE’s resilience and adaptability amid global economic pressures.

The survey highlighted that 46 percent of firms have committed to net-zero targets on active projects, while 56 percent reported expanding sustainable measures — a trend expected to accelerate under the UAE Energy Strategy 2050 and other green investment initiatives.

Construction costs rose by 3–5 percent across residential and mixed-use segments over the past year, but profit margins on medium and large-scale projects remain stable, the report added.

Despite challenges including rising input costs and limited skilled labor, optimism persists as firms invest in digital tools, modern construction techniques, and workforce upskilling to enhance delivery efficiency.

The survey concluded that continued innovation and strong public-private collaboration will be critical to sustaining the UAE’s construction growth in the years ahead.