New Delhi: Office rents in Dubai are increasing faster than those in New York or London for the first time in six years as international banks and corporations move into the financial hub famed for its love of glamorous architecture.

Skyscrapers like ICD Brookfield Place, which soars 928.5 feet (283 metres) above the financial sector, are evidence of the emirate’s scramble for office space. Nearly 90% of the 1.1 million square feet of office and retail space in the skyscraper, which opened as the epidemic spread throughout the globe, is already occupied or under contract, and there is a long waiting list for the remaining space.

UBS Group AG, the Israeli fintech company Rapyd, and Pernod Ricard SA, which relocated personnel from Hong Kong, are among the tenants.

Due to Dubai’s quick response to the pandemic and relatively simple access to visas, the emirate is attracting more wealth and foreigners, which is increasing demand for space in the building and throughout the city. While employees are returning to their workplaces at an especially high rate, an increasing number of businesses are expanding in the business hub’s sun-drenched location in favour of markets like Russia and Hong Kong.

“The whole market is sort of lifting itself up,” said Rob Devereux, chief executive officer of ICD Brookfield, a joint venture between New York-based Brookfield Asset Management Inc. and the emirate’s sovereign wealth fund, Investment Corporation of Dubai. “We’ve seen the return to the office much stronger than other jurisdictions” like the US and the UK, he said.

The commercial real estate market in Dubai, which was among the most impacted during a property recession brought on by the price of oil in 2014, has seen a dramatic change as a result of the recovery.

For the first time since early 2016, the value of office rentals in the city increased during the second quarter of this year. Through June, prime office rentals grew 7%, while grade A space rents rose 7.2%. Lower grade workplace, on the other hand, increased by 3%, according to real estate consultant CBRE Group Inc.

According to CBRE, prime rents increased by 1.4% in the City of London during the second quarter while they increased by 3% or less in different areas of New York.

While the pandemic has ushered in a fierce debate about future demand for office space globally, Dubai is a standout market at a time even as other financial hubs like New York and London push to lure employees back to their desks.

An average of 80% of workers are back in the office in the emirate compared with less than 40% of employees in the London City submarket, according to property broker Savills Plc. In the US, average office utilization rates were at almost 43% at the end of June, the highest level since the pandemic began.

Even while other financial centres like New York and London fight to get workers back to their desks, Dubai stands out in a time when a fierce discussion about the future demand for office space has erupted globally.

According to real estate broker Savills Plc, more than 80% of employees in the emirate are back at work as opposed to fewer than 40% in the London City submarket. At the end of June, the average office occupancy rate in the US reached its highest level since the epidemic started, hovering about 43%.

“Dubai is different because generally people drive and most live within half an hour of their workplace so there’s a greater tolerance to commuting,” ICD Brookfield’s Devereux said.

When Dubai offices “started becoming very attractive after covid, there was hardly any new supply because very few projects were built after the 2014 market slump,” said Taimur Khan, head of research at CBRE. This became a problem because “the allocation of visas is linked to the quantum of office space occupied,” he said.

According to Devereux, ICD Brookfield Place now has more than 100 tenants, which is a significant increase over a building of a comparable size in the US that would generally only have four or five tenants. The skyscraper contains 53 storeys and 46 elevators, as well as internal gardens for cooling down in the summer.