The analyst expects that the UAE’s construction industry to grow by 5.2% in real terms in 2025, supported by investments in energy and utilities, transportation, and power projects. The growth is also aided by the government’s allocation under the 2025 Budget that includes expenditure of AED71.5 billion ($19.5 billion), an increase of 11.6% compared to AED64.1 billion ($17.5 billion) expenditure earmarked in the 2024 Budget. Moreover, the fourth quarter of 2025 is estimated to be supported by the ongoing construction of new major projects. For instance, Indian construction company Rana Group commenced the construction works of Erisha Smart Manufacturing Hub project with an investment of AED36.7 billion ($10 billion) in Ras Al Khaimah Economic Zone in early-September 2025.
Over the remainder of the forecast period, the construction industry is expected to record an annual average growth rate of 4% from 2026 to 2029, supported by an improvement in the budgetary allocation under 2026 Budget, coupled with investments in transport, manufacturing and housing projects. The UAE’s Cabinet approved the federal budget for 2026 in late-October 2025 as part of the 2022-2026 Federal General Budget Plan. The budget includes expenditure of AED92.4 billion ($25.2 billion), an increase of 29.2% compared to AED71.5 billion ($19.5 billion) expenditure earmarked in the 2025 Budget. Expansion of businesses in the coming years is expected to bolster as part of National Agenda for Entrepreneurship that aims at establishing the UAE to be the entrepreneurial nation by 2031. This involves 29 initiatives aimed at promoting business environment in the UAE which can spark investments for the expansion of industrial buildings across the Emirate. Forecast period growth for the construction industry will also be supported by the National Investment Strategy 2031. It involves a target of increasing the inflow of annual Foreign Direct Investment (FDI) to AED238.7 billion ($65 billion) by 2031, compared to AED167.5 billion ($45.6 billion) in 2024.
Over the remainder of the forecast period, the construction industry is expected to record an annual average growth rate of 4% from 2026 to 2029, supported by an improvement in the budgetary allocation under 2026 Budget, coupled with investments in transport, manufacturing and housing projects. The UAE’s Cabinet approved the federal budget for 2026 in late-October 2025 as part of the 2022-2026 Federal General Budget Plan. The budget includes expenditure of AED92.4 billion ($25.2 billion), an increase of 29.2% compared to AED71.5 billion ($19.5 billion) expenditure earmarked in the 2025 Budget. Expansion of businesses in the coming years is expected to bolster as part of National Agenda for Entrepreneurship that aims at establishing the UAE to be the entrepreneurial nation by 2031. This involves 29 initiatives aimed at promoting business environment in the UAE which can spark investments for the expansion of industrial buildings across the Emirate. Forecast period growth for the construction industry will also be supported by the National Investment Strategy 2031. It involves a target of increasing the inflow of annual Foreign Direct Investment (FDI) to AED238.7 billion ($65 billion) by 2031, compared to AED167.5 billion ($45.6 billion) in 2024.
The Construction in the UAE - Key Trends and Opportunities to 2029 (Q4 2025) report provides detailed market analysis, information, and insights into the UAE’s construction industry, including:
- The UAE’s construction industry's growth prospects by market, project type and construction activity
- Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the UAE’s construction industry
- Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.
Report Scope
This report provides a comprehensive analysis of the construction industry in the UAE. It provides:
- Historical (2020-2024) and forecast (2025-2029) valuations of the construction industry in the UAE, featuring details of key growth drivers.
- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
- Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
- Listings of major projects, in addition to details of leading contractors and consultants
Reasons to Buy
- Identify and evaluate market opportunities using our standardized valuation and forecasting methodologies
- Assess market growth potential at a micro-level with over 600 time-series data forecasts
- Understand the latest industry and market trends
- Formulate and validate business strategies using the analyst's critical and actionable insight
- Assess business risks, including cost, regulatory and competitive pressures
- Evaluate competitive risk and success factors
Table of Contents
1 Executive Summary2 Construction Industry: At-a-Glance6 Construction Market Data
3 Context
4 Construction Outlook
5 Key Industry Participants
7 Appendix
List of Tables
List of Figures
