Dubai Media City is to get two new office buildings as part of a Dh1 billion investment to meet growing demand for space in the free zone.
Tecom, the business park operator that runs Media City, plans to develop 255,000 square feet of office space and an outdoor plaza with retail units.
It represents the largest development started by Tecom over the past 13 years and is set to be completed by the end of 2015.
“With more than 95 per cent occupancy, [the Butterfly] is mainly to address demand in Media City. The development began two months ago and will take 15 months for completion,” said Malek Al Malek, the chief executive at Tecom Business Parks.
Three more projects, DuBiotech Headquarters Building, Publishing Pavilion and Makateb make up the rest of the Dh1bn investment. The Dubiotech HQ will serve the science and energy sectors, covering an area of 500,000 sq ft with completion expected for the first quarter of 2015.
“The reason why we are building more commercial buildings is because there is demand from our business partners,” said Mr Al Malek. “We’re almost running out of space to address demand …we have enough capacity to meet demand for the next four to five years.”
There are currently 4,500 companies, ranging from global companies to start ups. Last year Tecom registered 549 new businesses partners while its current partners expanded by 11 per cent. The total number of workers across Tecom’s business parks, which also includes Dubai Internet City and Studio City, grew 23 per cent to 58,000.
“For some time now there has been very high demand among occupiers to get hold of expansion space, particularly from new occupiers. It certainly makes sense, it was starting to creak and getting towards full occupancy,” said Matthew Green, the head of research at the property services company CBRE. “It is something Tecom had to do and it is a reflection of how well the market is doing and how strong demand is. I expect to see other projects in the future.”
According to JLL, rents in the areas owned by Tecom rose as much as 35 per cent in 2013 – higher than rent increases in DIFC (11 per cent), Burj Downtown (14 per cent), Sheikh Zayed Road (27 per cent) and Business Bay (21 per cent).
thamid@thenational.ae
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