Commercial Property Value Estimator
To give investors a fast, data-driven starting point, we’ve created an interactive Commercial Property Value Estimator.
How It Works:
​You enter your net rental income (monthly or annual). Select your property type and location. The calculator applies current cap rate ranges for that area to generate a minimum and maximum estimated value per square foot.
How Commercial Property Is Valued in Dubai
Understanding how commercial property is valued is essential for any serious investor in Dubai’s dynamic real estate market. Unlike residential assets, which are typically valued based on comparable sales, commercial real estate is valued primarily using income-based approaches—most notably through capitalisation rates (cap rates) and net operating income (NOI).
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On this page, we’ll break down how it works, what to watch out for, and how you can use our interactive valuation tool to get a quick market estimate for your commercial property.
What Is the Capitalisation Rate (Cap Rate)?
A capitalisation rate, or cap rate, is a key metric used to assess the market value of income-producing real estate. In simple terms, it tells you how much an investor is willing to pay for a property based on the annual income it generates.
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Cap Rate Formula:
Cap Rate =
Market Value
Net Operating Income (NOI)
To estimate property value from the cap rate, the formula is inverted:
Market Value =
Cap Rate
Net Operating Income (NOI)
For example, if a property earns AED 800,000 annually and the market cap rate is 8%, its estimated market value would be AED 10,000,000.
What Is Net Operating Income (NOI)?
Net Operating Income (NOI) represents the annual income generated by a property after operating expenses, but before tax, debt service, or depreciation.
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NOI formula:
NOI = Gross Rental Income − Operating Expenses
Typical operating expenses include service charges, property management fees, maintenance costs, and insurance—but exclude mortgage payments and taxes.
How Cap Rates Are Determined in Dubai
Cap rates vary across different districts, asset types, and property profiles. For example, high-footfall retail units in Dubai Marina or Downtown Dubai will have different cap rates than office units in emerging zones like Dubai South or DIP.
Cap rates are influenced by:
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Location (e.g. prime vs fringe)
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Lease terms and tenant quality
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Vacancy risk
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Market comparables
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Future development pipeline
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Supply-demand dynamics
In Dubai, professional valuers adhere to RICS (Royal Institution of Chartered Surveyors) standards, which form the benchmark for all bank-led and institutional property valuations.
Challenges in Valuing Commercial Property
Valuing commercial real estate in Dubai is not always straightforward. Here are some common pitfalls and limitations to be aware of:
Incomplete or inconsistent NOI data
Many landlords do not account for service charges or management fees when calculating net income, resulting in inflated valuations.
Misinterpreted cap rates
Cap rates can vary significantly between comparable properties depending on lease length, covenant strength, or physical condition.
Overlooked regulatory constraints
Zoning rules, licensing requirements, and permitted business uses can restrict rental potential.
Unaccounted vacancy periods
If a unit has been empty or on rent-free terms, the true income may differ from advertised rent.
Variable service charges
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High service charges can drastically reduce NOI and skew yield expectations.
Location Coverage
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While our tool includes Dubai’s primary freehold commercial zones (Business Bay, Downtown, DIFC, JLT, JVC, Dubai Marina, etc.), other areas have been excluded due to a lack of reliable, up-to-date public data.
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We aim to expand the tool as more transparent cap rate data becomes available across other districts such as International City, Al Jaddaf, and Production City.
Why Work With Mitchell’s?
At Mitchell’s, we offer more than data—we help investors make smarter commercial property decisions with clarity and confidence.
With over 25 years in international finance and nearly two decades in Dubai real estate, we provide:
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Access to high-yield office, retail, and mixed-use opportunities in Dubai’s most active zones
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Deep-dive analysis of cap rates, tenant covenants, lease terms, and ROI forecasts
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Winning negotiation and deal structuring tailored to your tax strategy and exit goals
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On-the-ground knowledge to help you avoid pitfalls and maximise outcomes
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We’re not here to sell—we’re here to help you invest with precision - Let’s talk. No pressure—just strategic clarity.
Frequently Asked Questions (FAQs)
1. What is a good cap rate for commercial property in Dubai?
Cap rates in Dubai typically range from 5.5% to 10%, depending on location, asset type, and lease strength. Prime areas like Downtown Dubai or DIFC may have lower cap rates, while emerging zones like DIP or DSO can be higher.
2. Can I rely solely on the cap rate to determine property value?
No. Cap rates are a starting point, but actual value depends on net income accuracy, tenant risk, lease terms, and market demand.
3. What if my property has been vacant or recently renovated?
These factors can distort NOI and should be carefully adjusted for when estimating value. A professional valuation will consider these nuances.
4. Is this tool accurate for retail as well as office units?
Yes, where sufficient data is available. However, retail yields can vary widely based on footfall, visibility, and tenant type.
5. Do I need a formal valuation when buying or selling?
Yes. We strongly recommend a RICS-compliant valuation, especially for financing, insurance, or contractual purposes.