REALWorld Law

Corporate vehicles

Restrictions on foreign investment

Are foreigners allowed to invest by directly purchasing a commercial real estate asset?

United Arab Emirates - Abu Dhabi

United Arab Emirates - Abu Dhabi

Yes, but only where the real estate asset is located in one of the investment areas of Abu Dhabi. In these areas non-UAE nationals can hold the following land interests:

  • units and floors in buildings (but not the land itself);
  • usufruct rights (rights of exploitation) lasting up to 99 years;
  • musataha rights (development rights) lasting up to 50 years (renewable by mutual consent for a further term of 50 years); or
  • long-term leases with a term of up to 25 years.
  • In addition to the above, foreigners who are nationals from Gulf Co-operation Council (GCC) countries, or companies wholly owned by them, may also hold freehold interests in the land itself (conferring absolute ownership) within the designated investment areas.
  • The GCC countries are the United Arab Emirates, Qatar, Kuwait, Oman, the Kingdom of Saudi Arabia and Bahrain.

The Abu Dhabi Executive Council is permitted to designate certain individuals, companies and parties as having the same status as UAE nationals regarding land ownership in the Emirate. This has been done to date for two real estate development companies listed in Abu Dhabi Aldar Properties PJSC and Sorouh Properties PJSC, the two of which have since merged to form one company (being Aldar Properties PJSC). This designation enables these companies to own land interests throughout Abu Dhabi despite them having an element of foreign ownership.

In the Abu Dhabi Global Market financial free zone, only GCC citizens and companies wholly owned by them may hold a freehold interest in land. There are no such restrictions on buying other freehold interests in real estate, such as units and floors.