The UAE construction sector is gaining momentum, with 71% of industry professionals reporting positive market trends, according to Turner & Townsend’s UAE Market Intelligence 2025 survey. Sustainability commitments and investments in residential, infrastructure, and hospitality projects are driving confidence, though cost pressures remain a concern.
The survey, which gathered insights from contractors, consultants, and developers across the emirates, reveals sustained momentum across multiple sectors and reinforces the UAE’s position as a construction powerhouse amid global economic shifts.
Market Confidence Climbs
The 71% positive sentiment marks a 2% increase from last year, reflecting growing contractor confidence. Respondents identified real estate, tourism, and infrastructure as the top-performing sectors. Strong activity continues in residential, mixed-use, leisure, and hospitality projects, alongside major public infrastructure developments.
“Our survey shows a market that’s not only growing but evolving,” said Adam Ralph, UAE Country Manager at Turner & Townsend. “Clients and contractors alike are responding to the UAE’s ambitious development agenda with innovation, resilience and a clear appetite for sustainable progress.”
Sustainability Takes Centre Stage
A defining shift in the construction landscape is the emphasis on environmental responsibility. Forty-six percent of respondents reported a commitment to net zero on current projects, while 56% noted an increase in sustainable measures overall. This alignment reflects both market demand and the UAE government’s strategic priorities.
Turner & Townsend noted that this trend is expected to accelerate as the UAE Energy Strategy 2050 drives growth in utilities and energy sectors, positioning sustainability as a core business requirement rather than an optional add-on.
Cost Pressures and Profit Stability
Despite optimism, construction cost sentiment remains cautious. Respondents reported cost increases of 3 to 5 percent across mixed-use and residential projects over the past year. Talent shortages compound these pressures, creating operational challenges.
However, profit margins on mid- to large-scale projects remain stable, with contractors leveraging specialist expertise to secure favourable commercial terms and maintain competitiveness.
Digital Transformation and Delivery Innovation
The report emphasised the growing importance of modern construction methods, digital tools, and workforce upskilling. These capabilities are now essential for navigating complex project delivery and accelerated timelines, particularly as the UAE expands its infrastructure footprint and real estate offerings.
With major transport projects boosting property values and regional economic growth, the construction sector’s confidence reflects broader economic momentum across the emirates.
