Tecom expands Internet City as Dubai office space demand rises

Tecom Group, a developer and operator of business parks and free zones in Dubai, has launched the fourth phase of Innovation Hub in Dubai Internet City.

The expansion is intended to address the strong demand for office space in the emirate, the company said in a statement to the Dubai Financial Market.

The new phase will add a gross leasable area (GLA) of 263,000 sq ft with a development value of AED615 million ($167.5 million).

The launch of Innovation Hub phase 4 raises Tecom’s total investments in the project to AED2 billion. The new phase is expected to be completed in 2028.

The third phase of Innovation Hub has been fully leased ahead of its scheduled completion in 2027. The second phase is complete and fully leased to Fortune 500 companies, while the first phase houses global technology companies such as Google and Gartner.

The fourth phase will be self-funded through existing resources. Tecom’s revenue rose 20 percent year on year to more than AED2.1 billion in the first nine months of 2025, while net profit exceeded AED1.1 billion, up 18 percent annually.

In August, Tecom invested AED1.6 billion to acquire 138 land plots spanning 33 million square feet in Dubai Industrial City.

Dubai Holding Asset Management, owned by the ruler of Dubai, holds 86.5 percent of the company, while the remaining 13.5 percent is listed on the DFM.

Tecom operates 10 business districts in the emirate, including Dubai Media City and Dubai Internet City.

The company’s shares closed 0.3 percent higher at AED3.25 on Tuesday, having gained 3 percent so far this year.

The Tecom announcement comes as sales transactions in the office sector reached around 1,200 in the third quarter of this year, an increase of 40 percent year-on-year, while transaction values rose AED3.1 billion, a rise of 88 percent year on year, according to a report issued this month by real estate consultancy Cavendish Maxwell.

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As a result, office sale prices rose 5.3 percent quarter-on-quarter and 25 percent year-on-year, while rental rates increased 6.3 percent quarter-on-quarter and 29.5 percent year-on-year.

Dubai added 80,000 square metres of new office space during the first three quarters of this year, bringing the total to around 9.4 million sq m. From 2026 onwards, supply is projected to keep growing, rising to around 10.9 million sq m by 2028.

“The off-plan segment in particular is seeing a sharp acceleration in sales as investors look for newer premises with efficient layouts, ESG-aligned specifications and attractive payment plans,” said Vidhi Shah, head of commercial valuation at Cavendish Maxwell.