Buying a whole building in Dubai: process, pricing and due diligence

A foreign investor or family office can own a whole building in Dubai's designated freehold areas, pays a Dubai Land Department sale fee of 4 per cent of the contract value, and, if it holds the building through a company, pays UAE corporate tax at 9 per cent on taxable income above AED 375,000. Each of those points rests on a published law or Cabinet decision, cited below. The rest of a whole building acquisition, from pricing to due diligence, turns on documents the seller holds and the buyer must test.

This guide is for private investors, family offices and funds in the United States, Canada, Latin America and the Gulf who are moving from single units to whole assets: residential buildings, office floors and towers, hotel apartment buildings, retail and logistics. It does not quote a price for any asset Castilion Estates is mandated on.

Who can own a whole building in Dubai?

Ownership of real property in Dubai is governed by Law No. 7 of 2006 concerning real property registration, issued on 13 March 2006. Article 4 of the law restricts ownership to UAE nationals, nationals of the other Gulf Cooperation Council states, companies wholly owned by them and public joint stock companies. It then provides that, subject to the Ruler's approval, non UAE nationals may in areas the Ruler determines be granted freehold title without time limit, or usufruct or leasehold rights of up to 99 years.

Those areas were first listed in Regulation No. 3 of 2006, issued on 7 June 2006. Its first schedule included Dubai Marina, Palm Jumeirah, Jebel Ali, Al Jaddaf, Sheikh Zayed Road, Emirates Hills, Al Barsha South and parts of Al Quoz, and the regulation has been amended since, so the current status of any plot must be confirmed with the Land Department.

The same law makes registration decisive. Article 9 says a transaction that creates, transfers or extinguishes a property right is not valid unless it is recorded in the Property Register, and Article 24 gives the title deed absolute evidentiary value. For a whole building that means the buyer's protection is the register entry, not the sale contract alone.

A building can also be held through a company. The Land Department's sale registration page states that a company buying or selling must first be registered with the Department through a company registration request. Which entity types are accepted, and in which areas, is a Land Department policy that has changed over time, so the vehicle should be confirmed before it is formed.

Why do whole buildings trade off market, and how does the process run?

Whole buildings rarely appear on portals. An owner selling a tower or a fully let residential block usually does not want the asset's identity, rent roll or price circulating, because that can unsettle tenants, lenders and staff and weakens the owner's position if the sale does not proceed. The market answer is a gated process in which identity is released only to qualified parties under a signed confidentiality agreement.

On the Castilion commercial desk the sequence has six stages, the same for a single office floor and a whole tower.

1. NCNDA. Every conversation about a specific asset begins with a non circumvention and non disclosure agreement. Nothing identifying is shared before it is signed.
2. Buyer profile and proof of funds. A short profile of the buyer and evidence of funds or financing, so the seller knows who is at the table and the buyer's time goes only to assets within reach.
3. Offer memorandum. The full memorandum is released: identity, title, planning, tenancy, condition, income and the value framework, with a source for every figure.
4. Letter of intent. Price, structure, timetable and exclusivity are set out in a letter of intent. For Abu Dhabi land and larger Dubai assets a deposit accompanies it.
5. Due diligence. The buyer's legal, technical and tax advisers review the data room, and the adviser keeps the schedule and documents each stage.
6. SPA and transfer. The sale and purchase agreement is signed, and title transfers at the Land Department, or the shares of the holding vehicle pass, on completion.

The order matters. A buyer who has not shown proof of funds will not see the rent roll, and a seller who has not seen a letter of intent will not open the data room.

Should you buy the building or the company that owns it?

There are two ways to acquire a building. In an asset deal the buyer purchases the property itself and the title is transferred to the buyer at the Land Department. In a share deal the buyer purchases the company that owns the property, and the title stays in the company's name.

Investors sometimes assume a share deal avoids the transfer fee. Al Tamimi and Company, writing in its Law Update of June and July 2024, said the Land Department "charges fees for any direct or indirect share transfer" in the structure of a company that owns property, because it treats the transfer as a change in ownership. The same article said the Department may apply the reduced gift rate of 0.125 per cent instead of 4 per cent where the transfer is between first degree relatives or the ultimate beneficial owner does not change.

The fee is therefore rarely the reason to choose a share deal. The reasons are commercial: keeping existing leases, service contracts, financing or licences in place. The cost is that the buyer inherits the company's history, including its debts, disputes and tax position, so a share deal needs corporate and tax due diligence on top of property due diligence, and stronger warranties and indemnities in the agreement.

What does it cost to acquire a building?

Executive Council Resolution No. 30 of 2013, issued on 18 September 2013, sets the Land Department's fees. The sale registration fee is 4 per cent of the value of the sale contract. Article 3 says the fee is shared equally between seller and buyer unless they agree otherwise, and the Land Department's sale registration page lists 2 per cent for each. Who actually bears it is a negotiated term and belongs in the letter of intent.

The same page lists smaller fixed charges at the time of access on 7 November 2026: AED 250 for the title deed certificate, AED 225 for a unified map where the plot is under Dubai Municipality, knowledge and innovation fees of AED 10 each, and a service partner fee of AED 4,000 plus VAT where the sale value is AED 500,000 or more.

Where the purchase is financed, the resolution sets the mortgage registration fee at 0.25 per cent of the debt value. The resolution also provides for a fine of double the prescribed fee where fees are evaded, which is a reason to declare the full consideration.

Beyond the Land Department, the buyer budgets for its own legal, technical and tax advisers, a valuation if a lender requires one, any brokerage fee agreed in writing, and the cost of forming and maintaining the holding company where one is used.

How is a whole building priced?

Whole buildings are priced on income first and on comparables and cost second. Four measures appear in almost every memorandum, and a buyer should be able to rebuild each one from the documents.

1. Gross initial yield. The annual contracted rent divided by the price. It is quick to calculate and flatters the asset, because it ignores vacancy, operating costs and purchase costs.
2. Net initial yield. The net operating income, after vacancy, service and maintenance costs, insurance and management, divided by the price plus purchase costs. Because the 4 per cent Land Department fee adds to the cost base, the net initial yield on total acquisition cost is always lower than the yield on price alone.
3. Price per square foot. The price divided by the net leasable or saleable area, compared with recent transactions in the same district. Knight Frank put the average office sale price in Downtown Dubai at AED 5,130 per square foot in 2025, up 29 per cent from AED 3,986 a year earlier, as reported by Gulf News on 15 April 2026. Unit prices are a check on a whole building price, not a substitute for it, because a whole building trades at its own discount or premium to the sum of its units.
4. Replacement cost. The value of the land plus the cost of building an equivalent asset today. A price well above replacement cost depends on income or location that a new building nearby could not replicate.

Income capitalisation brings these together: the valuer divides a sustainable net income by a capitalisation rate taken from comparable transactions. The method is only as good as the two inputs. A rent roll that sits above the RERA index average cannot be assumed to hold at renewal, and a capitalisation rate should come from a named, dated transaction or report rather than a broker's opinion. This guide does not quote a market yield, because none of the reports reviewed for it published a dated whole building yield for Dubai that could be cited directly.

What should due diligence cover?

Due diligence on a whole building has six strands. Each one should be answered by a document, not a statement.

1. Title and plan. The title deed in the seller's name, the affection plan showing plot number, area, permitted use and height, and a check of the register for mortgages, caveats or attachments. Article 7 of Law No. 7 of 2006 gives the register absolute evidentiary value unless fraud or forgery is proven.
2. Service charges where the building is jointly owned. If units have been sold to third parties, Law No. 6 of 2019, issued on 4 September 2019, governs the building. Article 27 bars a management entity from collecting service charges without RERA approval, budgets must be approved by a RERA recognised auditor, and Article 30 requires a dedicated service charge account for each property. Service charge accounts are monitored through Mollak, the Land Department and RERA system, which is where arrears and budgets should be checked.
3. Completion and compliance. The building completion certificate, the Civil Defence certificates for fire and life safety, and evidence of Dubai Municipality approvals for any alterations or change of use. Unapproved works become the buyer's problem on transfer.
4. Tenancy. A full tenancy schedule reconciled to signed leases and to their registration. Article 4 of Law No. 26 of 2007, as amended by Law No. 33 of 2008, requires leases to be registered with RERA, which in practice means Ejari. Unregistered or informal leases are a red flag for both income and enforceability.
5. Rent caps and reversion. Decree No. 43 of 2013, issued on 18 December 2013, caps rent increases at renewal by reference to the RERA rental index average for similar units: no increase where the rent is up to 10 per cent below the average, 5 per cent where it is 11 to 20 per cent below, 10 per cent at 21 to 30 per cent, 15 per cent at 31 to 40 per cent and 20 per cent where it is more than 40 per cent below. Article 14 of the tenancy law requires at least 90 days' notice of amended terms before expiry, and Article 25 requires 12 months' notice, by notary public or registered mail, to evict at expiry for demolition and reconstruction, restoration that requires the property to be vacant, own use or sale. A business plan that depends on resetting rents must fit inside those limits.
6. Condition. A building survey of structure, facade, roofs, lifts, chillers or district cooling, plant and fire systems, with a costed plan for the next ten years of capital expenditure.

How is the income taxed?

The UAE corporate tax rate is set by Cabinet Decision No. 116 of 2022, issued on 30 December 2022: 0 per cent on taxable income up to AED 375,000 and 9 per cent on the portion above it. A company that holds an income producing building pays tax on its rental profit and on gains when it sells, subject to any relief that applies.

Individuals are treated differently. Cabinet Decision No. 49 of 2023, issued on 8 May 2023 and effective from 1 June 2023, excludes real estate investment income from business activity, whatever the amount. It defines real estate investment as investment activity by a natural person in the sale, leasing, subleasing or renting of land or property in the UAE "that is not conducted, or does not require to be conducted through a Licence." Hadef and Partners, commenting on the Federal Tax Authority guide issued on 24 October 2024, noted that an Ejari or Tawtheeq registration is an administrative record and not a licence, while a holiday home permit is.

Foreign companies are caught too. Cabinet Decision No. 56 of 2023, issued on 30 May 2023, says a non resident juridical person has a nexus in the UAE if it earns income from any immovable property in the State, which brings that income into UAE corporate tax.

The holding structure therefore changes the tax outcome, and it should be settled with a tax adviser before the letter of intent, not after.

Can you finance a whole building?

Yes. Banks in the UAE lend against income producing commercial property, and terms for a whole building are set case by case on the borrower, the rent roll, the tenants and the valuation. The lender will run its own valuation and title checks, and the mortgage registration fee of 0.25 per cent of the debt under Executive Council Resolution No. 30 of 2013 is part of the cost. Castilion Estates' mortgage desk can introduce lenders, and a buyer who intends to finance should say so in the buyer profile, because proof of financing carries weight with a seller.

What it means for investors

For a buyer in the Americas, the legal route into a whole Dubai building is clear: freehold title in a designated area, registered at the Land Department, held directly or through an accepted company. The friction is in costs, structure and tenancy law rather than in eligibility.

Three numbers shape every model. The 4 per cent Land Department fee sits in the cost base from day one and applies, in most cases, whether the building or the company changes hands. Corporate tax at 9 per cent above AED 375,000 applies to a company holding the asset, including a foreign company with UAE property income under Cabinet Decision No. 56 of 2023. Rent growth on existing leases is limited by Decree No. 43 of 2013 to the gap between the passing rent and the RERA index.

A dollar based family office also gains from the dirham's fixed peg to the US dollar, which removes currency risk between the purchase price and the rent. Reporting at home is a separate matter: a US, Canadian or Latin American owner should confirm with their own adviser how a UAE company or building is reported in their jurisdiction.

The practical point is that the memorandum is where risk is either disclosed or hidden. A buyer who insists on a sourced rent roll, a register search and a costed condition report before the letter of intent will price the building on facts. Buyers coming from single unit purchases may find our guide on how off plan purchases work in Dubai a useful comparison of the two regimes.

What we recommend

1. Decide the holding vehicle first and confirm with the Land Department that it can register title in the building's area. Confirm the current position with the authority before relying on it.
2. Ask for the tenancy schedule, the Ejari registrations and the RERA index position for every unit before agreeing a price, and model rent growth only within the Decree No. 43 of 2013 brackets.
3. Treat a share deal as a corporate acquisition. Budget for corporate and tax due diligence and for the Land Department fee on the share transfer.
4. Put the fee split, the exclusivity period, the deposit and the conditions of completion in the letter of intent.
5. Take tax advice on the structure before signing anything binding, because the same building can be taxed at 9 per cent or not at all depending on who owns it.

Castilion Estates runs whole asset transactions through its commercial desk under signed NCNDAs. To discuss a mandate in confidence, contact the team.