Abu Dhabi Waterfront: 5 New Islands Launching With Strong Capital Gains in 2025

REAL ESTATE1 month ago

Waterfront: Abu Dhabi’s AED 88B real estate market in 2024 (10,200 transactions, 25% year-on-year growth) offers apartments (AED 400K–15M), villas (AED 1.5M–50M), and townhouses (AED 1M–10M) with 6–9% ROI and 7–11% appreciation by 2028.

With 1.5M residents (projected 2M by 2030 per Abu Dhabi Vision 2030), 7.3M tourists in 2024, and a 4.5% GDP growth forecast for 2025, demand is driven by freehold laws (since 2014 for expats in designated areas), infrastructure (e.g., Sheikh Zayed Road, Etihad Rail, airport upgrades), and tax advantages zero personal income, capital gains, and inheritance taxes, VAT exemptions on residential properties, and 0% corporate tax for qualifying free zone income.

Five new island developments Ramhan Island, Jubail Island, Fahid Island, Nurai Island, and Hudayriyat Island promise strong capital gains (15–20% by 2028) due to their waterfront luxury, sustainable design, and integration with tourism and business hubs.

Backed by 90% absorption and Abu Dhabi Land Department escrow protections, these islands attract global investors (6,000 foreign transactions in 2024, AED 45B). This guide details each island, its freehold benefits, tax incentives, and investment potential, supported by 2024–2025 data.

1. Ramhan Island

Project Details: A natural island developed by Eagle Hills, featuring 1,800 villas (AED 12.8M–50M, 3,000–10,000 sqft), 900 apartments (AED 1.5M–10M, 800–3,000 sqft), 120 serviced residences, and a luxury hotel. Includes four sub-communities (Marine, Breeze, Cove, Views Island Villas) with private pools, marinas, and wellness centers. Handover Q4 2026 with 40/60 payment plans. Average price: AED 4,000 psf.
Freehold Benefits: Freehold ownership for all nationalities in designated areas, registered via Abu Dhabi Land Department. Enables global resale and wealth transfer.
Tax Incentives: Zero-rated first supply avoids 5% VAT (saving AED 640K–2.5M). Zero personal income tax on rentals (AED 600K–2M/year), zero capital gains tax on profits (e.g., AED 1.9M–10M by 2028), and zero inheritance tax. Gift transfers reduce 4% RETT to 0.125% (saving AED 249K–999K). Free zone ownership ensures 0% corporate tax.
Investment Potential: 6–8% ROI, with 85% occupancy driven by luxury tourism (7.3M visitors in 2024) and marina appeal. AED 2B in 2024 sales, with 15–20% appreciation by 2028 (e.g., AED 12.8M villa to AED 14.7M–15.4M). Residency visa eligible (AED 750K+).
Impact: Waterfront luxury, tax savings (AED 889K–3.5M), and proximity to Saadiyat Cultural District (15 min) attract high-net-worth investors from Europe, Asia, and GCC seeking premium returns.

2. Jubail Island

Project Details: A 4,000-hectare mixed-use development by Jubail Island Investment Company, offering 3–6-bedroom villas (AED 5M–20M, 3,500–8,000 sqft) and townhouses (AED 3M–8M, 2,000–4,500 sqft) across six villages (e.g., Souk Al Jubail, Marfaa Al Jubail). Features 30km waterfront, schools, and spas. Handover Q3 2025 for new phases with 50/50 payment plans. Average price: AED 2,500 psf.
Freehold Benefits: Freehold ownership for all nationalities in designated areas, registered via Abu Dhabi Land Department. Supports global sales and legacy planning.
Tax Incentives: Zero-rated first supply avoids VAT (saving AED 250K–1M). Zero personal income tax on rentals (AED 300K–1M/year), zero capital gains tax on profits (e.g., AED 750K–3M by 2028), and zero inheritance tax. Gift transfers reduce RETT to 0.125% (saving AED 99K–399K). Free zone ownership ensures 0% corporate tax.
Investment Potential: 6–9% ROI, with 90% occupancy driven by eco-friendly design and family demand. AED 1.5B in 2024 sales, with 15–20% appreciation by 2028 (e.g., AED 5M villa to AED 5.75M–6M). Residency visa eligible.
Impact: Low-density living, tax savings (AED 349K–1.4M), and connectivity to Yas Island (10 min) make it ideal for families and investors seeking sustainable luxury.

3. Fahid Island

Project Details: A new AED 13B waterfront development by Aldar and Mubadala, located between Saadiyat and Reem Islands. Offers villas (AED 3.8M–15M, 2,500–7,000 sqft) and apartments (AED 1.5M–8M, 600–2,500 sqft) with wellness-focused amenities and cultural district access. Handover Q2 2027 with 40/60 payment plans. Average price: AED 3,000 psf.
Freehold Benefits: Freehold ownership for all nationalities in designated areas, registered via Abu Dhabi Land Department. Enables global resale and wealth transfer.
Tax Incentives: Zero-rated first supply avoids VAT (saving AED 75K–750K). Zero personal income tax on rentals (AED 90K–500K/year), zero capital gains tax on profits (e.g., AED 570K–2.25M by 2028), and zero inheritance tax. Gift transfers reduce RETT to 0.125% (saving AED 74K–299K). Free zone ownership ensures 0% corporate tax.
Investment Potential: 6–8% ROI, with 85% occupancy driven by proximity to Louvre Abu Dhabi (5 min) and expat demand. AED 1B in 2024 sales, with 15–20% appreciation by 2028 (e.g., AED 3.8M villa to AED 4.37M–4.56M). Residency visa eligible.
Impact: Strategic location, tax savings (AED 149K–1.05M), and cultural appeal attract professionals and investors from GCC and Europe seeking high returns.

4. Nurai Island

Project Details: A refurbished luxury development by Aldar, located between Yas and Saadiyat Islands. Offers 3–7-bedroom villas (AED 10M–40M, 4,000–12,000 sqft) and apartments (AED 2M–10M, 800–3,000 sqft) with private beaches and LXR Hilton resort. Handover Q4 2025 with 50/50 payment plans. Average price: AED 3,500 psf.
Freehold Benefits: Freehold ownership for all nationalities in designated areas, registered via Abu Dhabi Land Department. Supports global sales and legacy planning.
Tax Incentives: Zero-rated first supply avoids VAT (saving AED 500K–2M). Zero personal income tax on rentals (AED 500K–1.5M/year), zero capital gains tax on profits (e.g., AED 1.5M–6M by 2028), and zero inheritance tax. Gift transfers reduce RETT to 0.125% (saving AED 199K–799K). Free zone ownership ensures 0% corporate tax.
Investment Potential: 6–8% ROI, with 85% occupancy driven by resort-style living and tourism. AED 800M in 2024 sales, with 15–20% appreciation by 2028 (e.g., AED 10M villa to AED 11.5M–12M). Residency visa eligible.
Impact: Ultra-luxury appeal, tax savings (AED 699K–2.8M), and proximity to Yas Marina (10 min) attract high-net-worth individuals and investors seeking exclusivity.

5. Hudayriyat Island

Project Details: A Modon masterplan featuring villas (AED 5M–20M, 3,000–8,000 sqft), apartments (AED 1M–5M, 600–2,500 sqft), and leisure facilities (e.g., Surf Abu Dhabi, velodrome, urban park). Supports eco-tourism and sports. Handover Q1 2026 for new phases with 40/60 payment plans. Average price: AED 2,000 psf.
Freehold Benefits: Freehold ownership for all nationalities in designated areas, registered via Abu Dhabi Land Department. Enables global resale and wealth transfer.
Tax Incentives: Zero-rated first supply avoids VAT (saving AED 50K–1M). Zero personal income tax on rentals (AED 60K–600K/year), zero capital gains tax on profits (e.g., AED 750K–3M by 2028), and zero inheritance tax. Gift transfers reduce RETT to 0.125% (saving AED 99K–399K). Free zone ownership ensures 0% corporate tax.
Investment Potential: 7–9% ROI, with 90% occupancy driven by adventure tourism and family amenities. AED 1.2B in 2024 sales, with 15–20% appreciation by 2028 (e.g., AED 5M villa to AED 5.75M–6M). Residency visa eligible.
Impact: Eco-friendly design, tax savings (AED 149K–1.4M), and connectivity to Abu Dhabi city (15 min) make it ideal for families and investors seeking lifestyle-driven returns.

Market Trends and Outlook for 2025

Yields and Appreciation: Abu Dhabi offers 6–9% ROI (apartments 6–9%, villas 6–8%) and 7–11% appreciation, driven by AED 88B in 2024 sales (25% YoY growth) and 9–20% rental growth. Off-plan sales (69% of transactions) dominate, with 10,000 units expected by 2028. Prices rose 7–11% in 2024 (AED 2,000–16,000 psf).
Freehold and Tax Environment: Freehold laws since 2014 allow expats to own property in designated areas, with inheritance rights, boosting demand (6,000 foreign transactions in 2024, AED 45B). Zero personal income, capital gains, and inheritance taxes, plus VAT exemptions, ensure tax efficiency. The 4% RETT (2% buyer) drops to 0.125% via gift transfers, saving AED 74K–999K on AED 1M–50M properties. Free zone entities (e.g., Abu Dhabi Global Market) offer 0% corporate tax. No RETT changes confirmed for 2025.
Infrastructure Impact: Sheikh Zayed Road, Etihad Rail (2023), and airport upgrades (22% flight increase in 2024) boost values by 5–10%. Tourism (7.3M visitors in 2024) and 85–90% occupancy drive rental demand (AED 500–3,000/night short-term). Abu Dhabi Vision 2030 supports sustainable urban growth.
Investor Drivers: Freehold status, 100% foreign ownership in designated areas, and flexible payment plans (5–10% down) fuel 65% of demand. Golden Visa (AED 750K threshold) and affordability (20–40% below Dubai) attract buyers from India, Europe, and GCC. Waterfront and leisure amenities drive end-user demand.
Risks: Oversupply (10,000 units by 2028), AML compliance costs (AED 3K–7K), and off-plan delays pose a 10–12% correction risk in H2 2025. Mitigated by 90% absorption, Abu Dhabi Land Department escrow accounts, and RERA regulations.
Regulatory Framework: Abu Dhabi Land Department ensures transparency with 4% RETT and digital portals (e.g., DARI, launched 2024) for registration. Escrow laws protect off-plan investments (e.g., Ramhan Island, handover Q4 2026). Freehold zones allow inheritance rights for expats.

Investment Strategy

Diversification: Invest in Ramhan Island (AED 1.5M–50M, 6–8% ROI) for luxury waterfront, Jubail Island (AED 3M–20M, 6–9% ROI) for eco-friendly living, Fahid Island (AED 1.5M–15M, 6–8% ROI) for cultural proximity, Nurai Island (AED 2M–40M, 6–8% ROI) for exclusivity, or Hudayriyat Island (AED 1M–20M, 7–9% ROI) for adventure tourism.
Entry Points: Off-plan units (5–10% down) like Fahid Island (40/60 plans) provide flexibility. Ready-to-move units in Nurai Island suit immediate rentals (AED 500K–2M/year).
Tax Optimization: Hold properties personally to avoid 9% corporate tax or use free zone entities (e.g., Abu Dhabi Global Market) for 0% corporate tax. Use gift transfers (0.125% RETT) or payment plans to reduce costs. Recover input VAT (AED 5K–100K/year) via FTA registration. Consult advisors like Shuraa Tax for compliance.
Process: Verify freehold status (expats limited to designated areas) and tax benefits via DARI portal. Pay 2% buyer RETT and secure NOC. Use platforms like Bayut, Property Finder, or JamesEdition. Required documents: passport copy, proof of funds, no UAE visa needed. Documents must be translated into Arabic and legalized.

Conclusion

In 2025, Abu Dhabi’s five new island developments Ramhan, Jubail, Fahid, Nurai, and Hudayriyat offer strong capital gains (15–20% by 2028) and 6–9% ROI, backed by AED 88B in 2024 sales. Freehold laws (since 2014 for expats in designated areas) enable global ownership and inheritance, while tax advantageszero personal income, capital gains, and inheritance taxes, VAT exemptions, and gift transfers (saving AED 74K–999K) maximize returns.

Despite a 10–12% correction risk from oversupply, 90% absorption, Abu Dhabi Land Department protections, and infrastructure (e.g., Etihad Rail, airport upgrades) ensure stability. With waterfront luxury, sustainable design, and proximity to cultural and tourism hubs (5–15 min), these islands attract families and investors. Explore opportunities via Bayut, Property Finder, or developers like Aldar and Eagle Hills for high-return, tax-efficient investments in Abu Dhabi’s thriving waterfront market. Abu Dhabi Waterfront