Interesting facts:
Full versionThe startup of a large industrial or commercial company in the United Arab Emirates entails the purchase or lease of a warehouse or industrial premises. Each of these procedures has its own features. Thus, when purchasing a warehouse or industrial premises in the UAE, foreign ownership of commercial real estate depends on the specific emirate and the territory's status. In specially designated freehold areas, foreign investors can acquire real estate outright. Other emirates may use long-term leasehold regimes or other forms of ownership. The exception is the emirate of Dubai, where Freehold status may be exercised, which entitles foreigners to purchase warehouses or production facilities together with the relevant land plot.
When purchasing commercial real estate, it's important to ensure that the property is located in an area where foreign ownership is permitted, that the project is registered with the relevant land department (e.g., Dubai Land Department), and that the developer is authorized to develop it. There is no property ownership tax in the UAE, but registration fees are charged when purchasing real estate, and additional administrative fees may apply. If you purchase a warehouse or production facilities in the United Arab Emirates on the secondary real estate market, then in addition to the amount charged by the property owner, you will also have to pay the Dubai Land Department registration fee of approximately 4% of the property value, as well as additional administrative fees and brokerage commissions. In most cases the procedure of registration of such documents and title transfer takes just a few days.
The possibility of a warehouse lease and its features or production facilities in the Emirates depend on the type of company. Offshore companies in the UAE (for example, those registered in JAFZA Offshore or RAK ICC) are not intended to conduct operations in the country and, as a rule, cannot lease commercial premises for business purposes. Companies registered on the UAE mainland (Mainland), as well as companies registered in free zones, can lease warehouse or industrial space if the warehouse is located in the appropriate zone or in approved logistics parks. Free zone companies typically lease warehouse or industrial space within the respective free zone. In some cases, operations outside the zone are possible through a distributor or subject to additional licensing requirements. Another important requirement: the type of leased premises must comply with the company's licensed activity and the requirements of the regulatory authority (Free Zone Authority or Department of Economy). Therefore, if you want to lease a warehouse in the UAE, the premises must have the appropriate permitted purpose (warehouse/industrial use) and meet zoning and company licensing requirements.
In conclusion it is worth noting that one should think about lease or purchase of warehouse at the stage of company registration. Having opted for an inexpensive option for starting business in the UAE, you may further face the problem of insufficient availability of proper warehouses and other commercial premises necessary for business. Besides, having saved on registration, you then may be charged an exorbitantly large amount for lease of real estate. Therefore, in order not to waste time and money, you should check availability, costs and other aspects related to purchase (lease) of warehouse at the stage of choosing the best option for registering a company in the UAE.
When purchasing warehouse space or industrial space in the UAE, you must understand the legal and regulatory requirements in a particular emirate or free zone. Mistakes in selecting or closing a property can result in extra costs, limited use of the property or trouble with business licensing.
Our consulting companies offer end to end support to investors and entrepreneurs for each stage of buying a warehouse or industrial space in UAE. We help you determine the best jurisdiction for doing business (corporate or free zone), find real estate that meets the requirements of the Convention, monitor the company's activities, and verify the legality of the property and ownership. Our consultants also support negotiations with the developer or property owner, help verify the project's registration with the relevant land department, evaluate the transaction terms, and calculate mandatory registration fees and additional expenses. In addition, specialists help prepare and prepare the necessary documents for transaction registration, interact with government agencies, and support the title registration process with the land department of the relevant emirate.
Clarify the cost of opening company, corporate or personal bank account, obtaining a residence visa, or another question regarding business in Dubai, UAE:
After acquiring a warehouse or industrial property, the consulting company can also assist with subsequent business setup steps: company registration, obtaining a license for the relevant activity, opening a corporate bank account, as well as organizing accounting and ensuring compliance with UAE corporate and tax laws.
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