How Smart Planning Leads to Profitable Projects
Feasibility studies are the unsung heroes of every real estate success story. In the fast-evolving UAE real estate market, where over AED 125 billion in transactions were recorded in Q1 2025 alone, strategic decisions backed by data are vital. Whether it's a developer evaluating a new plot in Abu Dhabi or an investor considering off-plan apartments in Dubai, feasibility studies offer the confidence and clarity required to move forward
Why Feasibility Studies Matter in UAE Real Estate
Feasibility studies test the commercial, financial, and technical practicality of any proposed real estate development before ground is broken. In a country where real estate contributes 5.5% of GDP, and where masterplans are reshaped regularly to align with Vision 2030 and COP28 sustainability goals, skipping a feasibility study isn’t just risky - it’s reckless
Components of a Solid UAE Real Estate Feasibility Study
A. Market & Demand Analysis
Goal: Confirm if the market actually needs what you're building.
UAE Stat: Over 70% of real estate buyers in 2024 were under 45, seeking mid-income, community-integrated housing.
Approach: Examine buyer trends, project absorption, competitor pricing, and product gaps.
B. Site & Regulatory Study
Goal: Understand location context, development rights, and infrastructure feasibility.
Example: In Dubai, projects near metro lines record 20–30% quicker sell-through rates.
Authorities: RERA, DMT, Sharjah Planning Council, Ajman Municipality.
C. Financial Feasibility & Modelling
Goal: Estimate construction costs, revenue forecasts, and profitability metrics.
Numbers to Know:
Construction Cost: AED 3,200–4,200/sqm GFA
Sales Price: AED 7,000–18,000/sqm, depending on location
IRR Benchmark: 14–18%
Equity Multiple: 1.7–2.0x
Payback: 3.5–5 years
D. Sensitivity & Risk Analysis
Goal: Test your project assumptions under best/worst-case scenarios.
Top Risks: Delays in approval, interest rate hikes, contractor shortages, market saturation.
E. Highest & Best Use Evaluation
Goal: Decide the most profitable and sustainable use of your land.
Example: Switching from luxury villas to mid-rise apartments may increase ROI by 28%
Why Investors & Institutions Care
Due Diligence: Banks and funds now require feasibility reports for loan or equity participation.
Strategic Alignment: Helps align with master developers to avoid project conflict.
Exit Strategy: Defines the best approach — bulk, off-plan, or REIT exits.
Investor Confidence: With over 45% foreign investor participation, transparency in planning builds trust.
The Funktion Realty Advisors Advantage
At Funktion Realty Advisors, we go beyond standard reports. We deliver investor-grade, decision-ready documents built on region-specific intelligence.
Custom Financial Models with KPI Visuals
Demand-Supply Mapping by Micro-location
Price Benchmarks & Forecasts
Approval Pathway & Risk Reports
Strategic Design & Phasing Inputs
Metric | Target Range |
IRR | 14–18% |
Equity Multiple | 1.7x – 2.0x |
Construction Cost | AED 3,200–5,000/sqm |
Selling Price | AED 7,000–18,000/sqm |
Payback Period | 3.5 – 5 years |
Feasibility Is the Foundation
In today’s high-stakes real estate landscape, feasibility isn’t optional — it’s foundational. Whether you’re planning your first project or your fiftieth, a comprehensive study helps convert vision into value.
Ready to Build Smarter?
📩 info@funktionra.com
🌐 www.funktionra.com
📍 Serving Developers Across UAE
