A look at trends in Sharjah’s construction and real estate sectors

The emirate of Sharjah has worked to brand itself as a unique place within the UAE and the wider GCC, which has resulted in an uptick in work for contractors as they try to close the gap in supply and demand for real estate, especially in the residential segment and for other family-friendly infrastructure. Although the Covid-19 pandemic temporarily disrupted the market, mixed-use developments that incorporate residential units, schools and retail outlets – along with a healthy dose of leisure activities and green spaces – have been emerging to meet high demand. In addition to demand coming from residents who want a less expensive alternative to other neighbouring emirates, a lot of recent interest has been coming from individuals and families who are drawn to Sharjah’s laid-back and authentic Arab culture. While many of the emirate’s residents do work in Dubai, the support the economy receives from both supportive government initiatives and inflows of foreign direct investment (FDI) is leading to the continued construction of office and industrial real estate. This is furthering the vision to create places of work and leisure closer to residents’ homes.

Structure & Oversight

Sharjah has a relatively diversified economy compared to other emirates and its GCC neighbours, with around 90% of GDP derived from non-oil sectors. In 2019 the construction and real estate sectors accounted for approximately 11% and 12% of GDP, respectively. Multiple government bodies are involved in construction and real estate activities in the emirate, including the Sharjah Department of Town Planning and Survey (SDTPS). Established in 1998, the SDTPS prepares comprehensive plans for all districts within its jurisdiction; implements housing policy; allocates residential, industrial, commercial and agricultural land; carries out urban renewal projects and re-plans older cities; and conducts transport and traffic studies. The department also monitors new buildings’ designs to preserve the local heritage and culture through the use of Islamic architectural styles.

The Sharjah Directorate of Public Works, meanwhile, is charged with the design, development, management and maintenance of government projects and facilities. Among the organisation’s strategies is the implementation of smart systems and use of technology to help improve performance and lower costs, while strengthening the unique identity of the emirate as the population grows and the economy develops. The Sharjah Directorate of Housing, for its part, provides housing support for citizens. The body provides loans and grants; works to construct permanent housing; and offers short-term accommodation in the case of fire, natural disaster or other emergencies. The department leverages e-services to process housing requests from citizens and handle contractor requirements.

Sharjah Investment and Development Authority (Shurooq) is the emirate’s primary investment-promotion body, but it also operates as a strategic partner in real estate projects, focusing on mixed-use developments that incorporate hospitality, leisure and cultural offerings. The Authority of Initiatives Implementation and Infrastructure Development was established by royal decree in early 2020 to promote infrastructure development and ensure government projects are executed according to international standards. The government office that is in charge of registering all developments in the emirate is the Sharjah Real Estate Registration Department (SRERD).

Building Materials

Construction materials in Sharjah are sourced from a mix of local producers, manufacturers in neighbouring emirates, and importers through airports and seaports. Two primary domestic producers are the Sharjah Steel Pipe Manufacturing Company (SSPMC) and Ginco Steel. The SSPMC was established in 1982 and currently operates at a capacity of 40,000 tonnes per annum (tpa) of welded line and pile pipes for the construction and petroleum sectors. Ginco Steel was established seven years prior and is active in the design, fabrication and erection of steel structures, most notably for the governments of Sharjah, Dubai and Abu Dhabi, as well as for the regional oil and gas industry.

Other large players include Sharjah Cement and Industrial Development, which owns Sharjah Cement Factory, the Paper Sacks Factory, and Gulf Rope and Plastic Products (GRPP). Sharjah Cement Factory has a grinding capacity of 1.1m tpa, while the Paper Sacks Factory can produce 120m sacks per year that can be used to package cement, fertiliser, chemicals and more – a portion of which is exported beyond the GCC. The GRPP plant has the capacity to produce 10,000 tpa of synthetic rope, which is both used locally and exported to more than 25 countries.

Price Index

Building materials have been subject to a 5% value-added tax (VAT) in the UAE since early 2018. Although Sharjah does not have its own index that tracks the price of construction materials, the index produced by the Chamber of Commerce in Dubai can provide insight into the cost of inputs in its neighbouring emirate. According to the chamber’s construction materials price index, in the first quarter of 2018 – after VAT had been implemented – all categories saw a quarter-on-quarter rise, with the cost of wires and cables up 13%, steel up 7.7%, bricks up 6.3%, and pipes and fittings up 5.3%. While the market has since adjusted to VAT, prices continue to tick upwards. In the fourth quarter of 2020, eight of the 16 categories tracked by the index recorded year-on-year price increases, ranging from 1.2% for glass and mirrors; to 6.8% for wires and cables; to 9.3% for both pipes and fittings, and metal products; and 17.1% for steel. Only cement and gypsum, and ready-mix concrete recorded declines of 11.4% and 10.4%, respectively, while prices in the remaining categories remained steady.


One of the emirate’s largest construction undertakings in recent years is Aljada, a Dh24bn ($6.5bn), 2.2m-sq-metre, mixed-use community in the Al Zahia district of New Sharjah. Launched in 2018, Aljada comprises nine residential clusters with flats, villas and townhouses; entertainment venues; retail and dining options; and schools. Sharjah-based developer Arada is leading the project, with contractors awarded different roles. The second half of 2020 saw several contracts assigned, including a Dh423m ($115.1m) agreement signed in August with Best Building Contracting to erect 16 apartment blocks – comprising almost 2000 units – in the East Village cluster aimed at younger adults. East Village was 95% sold out at the time of the agreement, demonstrating sustained demand for flats in integrated communities.

The following month an agreement was signed with Al Zamalek General Contracting to build the Dh220m ($59.9m) SABIS International School – Aljada. The K-12 institution is the first of three planned for Aljada, with the initial phase of construction focusing on kindergarten through third grade set for completion by September 2021 for the 2021/22 school year. Additional grades will be added for the start of the 2022/23 and 2023/24 academic years, for a total capacity of 4000 students. October 2020 saw another contract, valued at Dh102m ($27.8m), awarded to Al Marwan General Contracting for all infrastructure – including the electricity, water, communications and road networks – for East Village, the student housing cluster Nest, SABIS International School – Aljada and other structures in the fourth phase of the project. Aljada is also set to include 250,000 sq metres of green areas, 500,000 sq metres of office space, 165,000 sq metres of leasable retail space, and a 200,000-sq-metre recreation area featuring 10 attractions and four hotels. When construction began in 2018, the mega-project had a targeted completion date of 2025.

Shurooq Projects

Shurooq is a key player in the market and often works in partnership with other major developers. Some of its most recent developments include the $30m Al Luluyah Beach and $23.7m Al Hira Beach projects, which were launched in June 2021. Another major project was the House of Wisdom – a high-tech library and social centre – which was constructed to celebrate the emirate receiving the title of UNESCO World Book Capital 2019, a first for the GCC. Designed by UK-based Foster + Partners and inaugurated in December 2020, the 12,000-sq-metre structure features contemporary Arab architecture and serves as reminder of the emirate’s emphasis on literature, education and culture. In partnership with UAE developer Eagle Hills, Shurooq is also working on the Dh4.5bn ($1.2bn) Maryam Island project, a mixeduse development spanning 460,000 sq metres that will have residences, hotels, waterfront dining, shops and leisure facilities. The first phase, which wrapped up in December 2020, included nearly 700 residential units, 40 food outlets, swimming pools, a playground and beach access. The second phase, focusing on the Maryam Gate Residences, is targeted for completion in 2022. Meanwhile, Shurooq is partnering with Kuwaiti developer Mabanee to build the 65,000-sq-metre Avenues Mall Sharjah in the Mughaider suburb, due for the end of 2022. There will be approximately 70 units for lease, 30% of which will be reserved for food outlets. In Kalba, on the coast of the Gulf of Oman, another waterfront shopping and entertainment area is being developed by Shurooq and Eagle Hills. The Dh160m ($43.6m) project is set to open in the second quarter of 2021, spanning 17,000 sq metres, and will include 86 retail outlets, a supermarket, a food court and a family entertainment centre. Shurooq is also developing projects in Khorfakkan, including a fivestar, 66-key property located along the Khorfakkan Beach, which will also include the city’s first waterpark.


The UAE has redoubled its focus on sustainability in recent years, adopting international green building certificates in 2006. Retrofitting initiatives gained momentum across the country in the decade leading to 2020, and in 2018 the Sharjah Electricity and Water Authority launched the emirate’s own programme that focuses on the top-100 energy consumers. Overhauling the construction of these buildings is expected to reduce energy consumption by approximately 30% on the premises. As of mid-2020, 18 buildings had been completed under the programme.

Another important green construction initiative is the development of Sharjah Sustainable City. In partnership with Dubai-based Diamond Developers, Shurooq is set to create the first fully integrated, net-zero-energy community in Sharjah, comprising homes, a school, a mosque, and play and sport facilities. The city targets 100% renewable energy – largely from rooftop solar panels – and total water reuse for irrigation. The ultimate goal is energy use intensity of 80 KWh per sq metre per year, compared to the UAE average of 330 KWh. As of early 2021 the first phase of the city was complete and the second was under way.

Real Estate

Real estate entered 2020 in a strong position, with Dh24.2bn ($6.6bn) worth of transactions in 2019 – up 7.3% from 2018. Of the deals conducted in 2019, over 11,500 were title deeds worth Dh9.6bn ($2.6bn), while around 3300 were sales covering approximately 4.3m sq metres. The bulk of sales (2963) occurred in Sharjah City – valued at Dh4.8bn ($1.3bn); and of these, the Muwaileh commercial area saw 567 deals worth Dh1.2bn ($326.6m). Meanwhile, Khorfakkan recorded 117 sales transactions totalling Dh73.4m ($20m), largely for industrial and commercial spaces; the Central Region recorded 114 sales transactions totally Dh102.9m ($28m); and 110 sales were registered in Kalba, totalling Dh49.3m ($13.4m). Dibba Al Hisn, for its part, recorded 24 sales worth Dh18m ($4.9m).

The pandemic and related disruptions negatively affected Sharjah’s real estate sector. According to UAE property website Bayut.com, in the third quarter of 2020 sale and rental prices in Sharjah experienced declines similar to those seen across the UAE, yet return on investment (ROI) in established communities remained strong, topping 6% in Al Majaz, Al Nahda and Al Khan – a waterfront area close to Dubai. However, the total value of real estate transactions fell to Dh15.9bn ($4.3bn) by the end of 2020, according to the SRERD. Of all the sales transactions that year, 75.3% were residential properties, 11.1% were commercial, 10.4% were industrial and 3.2% were agricultural plots. Of the 3773 transactions recorded in 2020, the categories to see the most activity were residential land (1006 transactions), apartments (901 transactions), residential built-in land (712) transactions and industrial land (268 transactions). The highest-ranked areas in terms of transactions were Hoshi, Al Khan and Al Nahda, at 753, 515 and 337 transactions, respectively.


Al Majaz was the most popular area in which to rent flats, with rents in that area declining by 5.6% for studios and 4% for one-bedroom apartments quarter-on-quarter (q-o-q), while rent for two-bedroom apartments rose by 2.9%. Al Nahda and Al Taawun saw a similar drop in rents for studios – both down 5.6% – while rents for one-bedroom apartments fell by 4% and 3.8%, respectively. The popularity of two-bedroom apartments – which cost an average of Dh34,000 ($9250) to Dh35,000 ($9530) per year – is a reflection of Sharjah’s reputation as a family-friendly location, with quality schools and entertainment options. Meanwhile, Al Jazzat garnered the most interest from villa renters in the third quarter, due to the area’s connectivity, proximity to major attractions and affordable rates, as asking rents on the Bayut website began at Dh25,000 ($6810). Sharqan continues to be a popular option to lease homes, with posted rents in the third quarter starting at Dh65,000 ($17,700).

The most highly searched areas for apartment purchases were Al Khan and Al Majaz, which saw slight q-o-q increases in prices per sq foot – at 1.3% and 1.2%, respectively. The price for a two-bedroom flat averaged Dh697,000 ($190,000) in Al Khan, and Dh502,000 ($137,000) in Al Majaz. Al Rahmaniya was the preferred location for villa purchases, with listings starting at Dh1.3m ($354,000). Buyers – particularly those with families – also showed interest in Muwaileh, on the outskirts of Sharjah City, due to its proximity to schools, transport, malls and restaurants. Muwaileh villas listed on Bayut.com during the third quarter ranged from Dh1.1m ($299,000) to Dh3.8m ($1m). For investors looking to purchase villas to rent out, ROI was highest in Al Noaf, at 11.5%, while Al Sabkha, Barashi, Muwaileh, Hoshi and Al Gharayen had rental yields above 5%. While the pandemic was expected to put downward pressure on both the real estate sector and the wider economy, there were signs that the market would emerge from the crisis in a relatively strong position. Arada, for example, closed 2020 with record sales of Dh1.8bn ($490m), up 35% on 2019. The company sold 2337 residential units during the year, 1977 of which were located in Aljada.

Office & Industrial

According to Cavendish Maxwell, office rents in Sharjah declined slightly between the first and third quarters of 2020. In the July-to-September period the prices per sq foot in Abu Shagara/Al Qasimia and Sharjah City’s industrial area were even, at Dh24 ($6.53) to Dh29 ($7.89) for shell and core space, and Dh38 ($10.34) to Dh48 ($13.07) for fitted offices. Prices in Al Khan and Al Majaz, as well as around Al Taawun Road, were a bit more expensive, at Dh24 ($6.53) to Dh33 ($8.98) for shell and core units, compared to Dh38 ($10.34) to Dh57 ($15.52) for fitted space. While a shift to remote work has slowed demand for office space, continued investment inflows are expected to keep demand strong in the longer term. Indeed, the emirate attracted 24 FDI projects valued at a combined $220m over the course of 2020, with FDI expanding by 60% between the third and fourth quarters, according to a study by FDI intelligence firm Wavteq. This trend is expected to continue into 2021, with the company projecting FDI in ICT and life sciences to increase by 55.6% and 74%, respectively, in 2021. This is forecast to help sustain demand for office space.

Sharjah is also working to expand the availability of commercial and industrial land. In August 2020 the Sharjah Executive Council released a second round of land grants, bringing the year-to-date number of plots to 8100. The batch included 178 commercial and 362 industrial plots. The emirate has steadily expanded its industrial footprint in recent years by building designated zones for business, with warehouses leasing for Dh15 ($4.08) to Dh30 ($8.17) per sq foot as of the third quarter of 2020. Highlighting the segment’s potential, Sharjah’s FDI in logistics and distribution is expected to increase by 46.2% in 2021, according to Wavteq.


In November 2020 Sheikh Sultan bin Mohammed bin Sultan Al Qasimi, crown prince, deputy ruler of Sharjah and chairman of the Sharjah Executive Council, announced the emirate’s second stimulus to counteract the negative effects of the pandemic on businesses, individuals and the government. The Dh512m ($139.4m) package follows an earlier stimulus worth Dh481m ($130.9m), and allows owners of commercial and industrial properties to make utilities payments in instalments. Other measures pertaining to real estate include the waiving of rental payments for investment properties until March 31, 2021, as well as a 25% discount on rents for temporary sites.

Moreover, the SRERD reduced buyer fees for nonGCC citizens from 4% to 2% of the property’s sale value in the stimulus. In 2014 the emirate’s real estate investment laws were amended to allow foreigners of any country to buy property, widening the scope beyond GCC nationals. However, foreign investors had to hold valid residency, and were restricted to certain locations and a maximum of five purchased properties. A subsequent amendment in 2018 allowed foreigners to purchase property without a residence permit, but location constraints remain in place, especially for non-Arab buyers. The law does not allow expatriates to own freehold property in Sharjah, but buyers have the right of usufruct for a maximum of 100 years.


While the pandemic resulted in disruptions to many business activities, construction and real estate in Sharjah were less affected. The high sales rates of off-plan residential properties underscored the attractiveness of Sharjah’s location, while stimulus packages facilitated the uptake of properties. As the emirate continues to develop its economy, office and industrial space are expected to see steady demand.

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