Rents and occupancy rates in Dubai will fall in 2009 as expatriates leave the Gulf Arab region's business hub as a result of the global economic downturn, CB Richard Ellis said on Thursday.

Dubai's once-booming property sector is suffering a sharp slowdown, with real estate prices tumbling 41 percent in the first three months of 2009, according to property consultants Colliers. The slowdown has led to project cancellations worth billions of dollars and jobs being slashed.

"The drop in demand for commercial and rental space, following the decline in an expatriate workforce, will have a significant impact on the lease and occupancy rates in all areas of Dubai throughout 2009," the real estate services firm said in a report.

Prime office rents fell by around 18 percent in the first quarter, compared with the same period last year, it said.

"Many projects currently penned for completion during the course of the year are likely to be further delayed and pushed back into next year." Dubai's population is set to fall 17 percent this year, EFG-Hermes said in a report in March.


Source: Reuters