New Abu Dhabi Real Estate Laws – Laying the Legal Foundations for Institutional Investment

White & Case LLP

The years since the global financial crisis of the last decade have witnessed a significant increase in institutional investment (for instance, by pension funds, sovereign wealth funds and insurers) into global real estate. This trend appears set to endure, as institutional investors continue to increase the percentage of their portfolios targeted for allocation to real estate1.

The Emirate of Abu Dhabi has of course played a leading role in this, through funds such as those managed by the Abu Dhabi Investment Authority which have made major investments in landmark real estate assets in the US, UK and other global markets. However, whilst there have been major capital flows outwards from Abu Dhabi over recent years, in comparison only small amounts of institutional money have historically been invested inwards into the Abu Dhabi real estate sector, and the majority of this has come from regional (i.e. GCC and other Middle Eastern) investors. There are various reasons for this, but one of the principal ones may be the perception that the legal framework needed to be updated in line with the requirements of institutional investors.

Against this backdrop, two new sets of laws have been introduced over the last year, which have radically altered the legal framework governing the real estate sector in Abu Dhabi and which have put the Emirate on a more level playing field with its neighbour Dubai in this regard. Collectively, these new laws create a more stable, robust and transparent (and thus "de-risked") legal platform for owning, investing in, developing and financing real estate projects in Abu Dhabi.

Whilst certain hurdles to institutional investment inevitably remain, the introduction of these new laws is a vital step towards laying the legal foundations necessary to facilitate increased institutional investment into Abu Dhabi real estate, both from regional and non-regional investors.

What are these New Laws?

The two new sets of laws referred to above (collectively, the "New Laws") are:

  • The Property Regulations 2015 and the Strata Title Regulations 2015, which came into force on 14 June 2015, and which apply to real property within the geographical area of the new offshore financial freezone known as the Abu Dhabi Global Market (the "ADGM") which currently comprises the whole of Al Maryah Island (the "ADGM Laws"); and
  • Abu Dhabi Law No. 3 of 2015 Concerning the Regulation of the Real Estate Sector in the Emirate of Abu Dhabi, which came into force of 1 January 2016, and which applies to real property within the Emirate of Abu Dhabi but which (with certain limited exceptions) has no application to real property within the ADGM (the "Onshore Law").

How have these New Laws created a more robust legal framework?

Collectively, the New Laws create a more stable, robust and transparent (and thus "de-risked") legal platform for owning, investing in, developing and financing real estate projects in Abu Dhabi. Whilst a discussion of the minutiae of the New Laws is beyond the scope of this briefing, we have summarised some of the headline features below:

  • Application of English law in ADGM – in similar vein to the DIFC and other jurisdictions such as Hong Kong and Singapore before it, the ADGM has adopted English law (including the principles of equity) as the basis for its legal framework, including with respect to the ownership and registration of real property. The intention is to create a legal regime for real estate that international investors know, trust and are familiar with, and which has stood the test of time.
  • Enhanced industry regulation – under the Onshore Law, it is now mandatory for all developers and other key industry participants (brokers, surveyors, valuers, auctioneers and co-owners' association managers) to be licensed by the Department of Municipal Affairs and Transport ("DMAT") before carrying out any business activities. Such licenses must be renewed annually and applicants must, if required by DMAT, undertake compulsory training courses in order to obtain and/or renew their licences. Persons who carry out business activities without the requisite licenses are liable to fines (of up to AED 2,000,000) and, in some cases, imprisonment. Although the Onshore Law is not generally applicable within the ADGM, we understand that the ADGM is in practice requiring developers (and other key industry participants) to register with and be licensed by DMAT before carrying out any activity within the ADGM. Accordingly, the ADGM has signed a Memorandum of Understanding with DMAT pursuant to which DMAT is confirmed as the competent authority for registering developers (and other key industry participants) who wish to carry out business activities within the ADGM.
  • Strata title – the New Laws introduce a legal framework for strata title and ownership in Abu Dhabi, similar to that already in force in Dubai. Developments in Abu Dhabi (both in the ADGM and onshore) are now capable of being subdivided both vertically and horizontally and sold to multiple investors on a "freehold" basis (with common parts being held communally by a co-owners' association, or in certain circumstances being retained by the developer). Developments can also be subdivided on a "volumetric" basis into different use components, with some components (e.g. residential or office space) being subject to strata ownership but with other components (e.g. a hotel or a shopping mall within the development) being subject to single ownership and thus capable of being sold to a single investor with distinct title.
  • Mandatory escrow accounts – the New Laws introduce mandatory escrow account provisions to protect off-plan purchasers, similar to those already in force in Dubai. Going forwards, developers of projects in Abu Dhabi (both in the ADGM and onshore) that involve off-plan sales must, by law, establish an escrow account into which must be paid all proceeds from those off-plan sales and also from bank finance relating to the project. These proceeds are then ring-fenced for exclusive use in relation to the project. Payments out of the escrow account to the developer are only permitted in certain pre-defined circumstances linked to construction progress. Under the Onshore Law, there is an outright prohibition on any monies (whether from off-plan sales or bank finance) being released to the developer until the project is at least 20 percent complete; meaning that, in practice, projects outside the ADGM will need to be self-funded as to the initial 20 percent of their cost. Following practical completion, the escrow agent is required to retain a minimum amount of the proceeds in escrow for a minimum period of time, as security for the repair of latent defects.
  • Enhanced protections for off-plan purchasers – alongside the new escrow provisions, the New Laws also introduce greater general protections for off-plan purchasers. For instance, the Onshore Law introduces certain protections for off-plan purchasers where projects are delayed or cancelled, as well as termination rights in certain predefined circumstances, including where the unit delivered substantially differs from the specification set out in the SPA, or is unusable due to fundamental defects in construction.
  • Clarity around mortgage enforcement – the New Laws give greater clarity to the procedures that a mortgage lender must follow when taking enforcement action following a borrower default. In the case of real property within the ADGM, mortgage lenders now (as is already the case in the DIFC in Dubai) have a wider array of potential remedies than is available onshore, such as the power to sell the property by way of private contract (rather than by public auction, which is the usual method of enforcement in the UAE), the power to enter into possession and receive the rents and profits from the property, and the ability to appoint a receiver. Over time, this may give rise to a secondary "loan to own" market, at least for property within the ADGM, whereby distressed real estate can be acquired indirectly through buying and enforcing on mortgage debt attached to it.

Why is this good news for institutional investors?

Whilst there have been major capital flows outwards from Abu Dhabi into global real estate assets over recent years, only small amounts of institutional money have historically been invested inwards into the Abu Dhabi real estate sector (with the vast majority of that money coming from regional investors who already know and understand the region). The same is largely true of Dubai (although institutional activity levels there have tended to be slightly higher than in Abu Dhabi).

Various reasons have been cited for this by market commentators, such as lack of investment grade product; a shortage of willing sellers coupled with the long term "hold" strategy favoured by local investors; limited liquidity; the fledgling nature of REITs and investment markets in the region; and restrictive foreign ownership laws2. However, another factor inhibiting institutional investment into Abu Dhabi in the past has been the perception that the legal framework governing the real estate sector needed to be updated in line with the requirements of institutional investors.

The reforms brought about by the New Laws have radically altered the legal framework governing the real estate sector in Abu Dhabi and have put the Emirate on a more level playing field with its neighbour Dubai in this regard. Collectively, these laws create a more stable, robust and transparent (and thus "de-risked") legal platform for owning, investing in, developing and financing real estate projects in Abu Dhabi, which is more capable of supporting investment by (and more likely to be attractive to) institutional investors.


The New Laws are a significant step forwards for the real estate sector in Abu Dhabi.

We are still very much in the early days of the implementation of the New Laws. As is the case when any major new laws are introduced, there has inevitably been an initial "road testing" period, whilst the New Laws are being assimilated into the market and the processes for implementing them are being rolled-out by the relevant authorities.

Looking to the future, the introduction of the New Laws is undoubtedly a key part of the process of repositioning the Abu Dhabi real estate sector so that it is more attractive and more marketable to institutional investors. This is not to say that levels of institutional investment are going to increase overnight, as this is of course also dependent on market forces and other external factors. However, over time, the hope is that the New Laws will facilitate an increase in levels of institutional investment into Abu Dhabi real estate (both from regional and non-regional investors), with Abu Dhabi also taking a larger share of the overall institutional investment coming into the region (the majority of which is currently being allocated to Dubai).

1 See Cornell University’s Baker Program in Real Estate and Hodes Weill & Associates LP, "2015 Institutional Real Estate Allocations Monitor". This states (p. 8) that the average target allocation to real estate amongst the 242 global institutional investors it surveyed was expected to be 9.85% in 2016; up from 9.56% in 2015, 9.3% in 2014 and 8.9% in 2013.
2 See CBRE, "In and Out: Middle East 2015", p. 9.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© White & Case LLP | Attorney Advertising

Written by:

White & Case LLP

White & Case LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide

JD Supra Privacy Policy

Updated: May 25, 2018:

JD Supra is a legal publishing service that connects experts and their content with broader audiences of professionals, journalists and associations.

This Privacy Policy describes how JD Supra, LLC ("JD Supra" or "we," "us," or "our") collects, uses and shares personal data collected from visitors to our website (located at (our "Website") who view only publicly-available content as well as subscribers to our services (such as our email digests or author tools)(our "Services"). By using our Website and registering for one of our Services, you are agreeing to the terms of this Privacy Policy.

Please note that if you subscribe to one of our Services, you can make choices about how we collect, use and share your information through our Privacy Center under the "My Account" dashboard (available if you are logged into your JD Supra account).

Collection of Information

Registration Information. When you register with JD Supra for our Website and Services, either as an author or as a subscriber, you will be asked to provide identifying information to create your JD Supra account ("Registration Data"), such as your:

  • Email
  • First Name
  • Last Name
  • Company Name
  • Company Industry
  • Title
  • Country

Other Information: We also collect other information you may voluntarily provide. This may include content you provide for publication. We may also receive your communications with others through our Website and Services (such as contacting an author through our Website) or communications directly with us (such as through email, feedback or other forms or social media). If you are a subscribed user, we will also collect your user preferences, such as the types of articles you would like to read.

Information from third parties (such as, from your employer or LinkedIn): We may also receive information about you from third party sources. For example, your employer may provide your information to us, such as in connection with an article submitted by your employer for publication. If you choose to use LinkedIn to subscribe to our Website and Services, we also collect information related to your LinkedIn account and profile.

Your interactions with our Website and Services: As is true of most websites, we gather certain information automatically. This information includes IP addresses, browser type, Internet service provider (ISP), referring/exit pages, operating system, date/time stamp and clickstream data. We use this information to analyze trends, to administer the Website and our Services, to improve the content and performance of our Website and Services, and to track users' movements around the site. We may also link this automatically-collected data to personal information, for example, to inform authors about who has read their articles. Some of this data is collected through information sent by your web browser. We also use cookies and other tracking technologies to collect this information. To learn more about cookies and other tracking technologies that JD Supra may use on our Website and Services please see our "Cookies Guide" page.

How do we use this information?

We use the information and data we collect principally in order to provide our Website and Services. More specifically, we may use your personal information to:

  • Operate our Website and Services and publish content;
  • Distribute content to you in accordance with your preferences as well as to provide other notifications to you (for example, updates about our policies and terms);
  • Measure readership and usage of the Website and Services;
  • Communicate with you regarding your questions and requests;
  • Authenticate users and to provide for the safety and security of our Website and Services;
  • Conduct research and similar activities to improve our Website and Services; and
  • Comply with our legal and regulatory responsibilities and to enforce our rights.

How is your information shared?

  • Content and other public information (such as an author profile) is shared on our Website and Services, including via email digests and social media feeds, and is accessible to the general public.
  • If you choose to use our Website and Services to communicate directly with a company or individual, such communication may be shared accordingly.
  • Readership information is provided to publishing law firms and authors of content to give them insight into their readership and to help them to improve their content.
  • Our Website may offer you the opportunity to share information through our Website, such as through Facebook's "Like" or Twitter's "Tweet" button. We offer this functionality to help generate interest in our Website and content and to permit you to recommend content to your contacts. You should be aware that sharing through such functionality may result in information being collected by the applicable social media network and possibly being made publicly available (for example, through a search engine). Any such information collection would be subject to such third party social media network's privacy policy.
  • Your information may also be shared to parties who support our business, such as professional advisors as well as web-hosting providers, analytics providers and other information technology providers.
  • Any court, governmental authority, law enforcement agency or other third party where we believe disclosure is necessary to comply with a legal or regulatory obligation, or otherwise to protect our rights, the rights of any third party or individuals' personal safety, or to detect, prevent, or otherwise address fraud, security or safety issues.
  • To our affiliated entities and in connection with the sale, assignment or other transfer of our company or our business.

How We Protect Your Information

JD Supra takes reasonable and appropriate precautions to insure that user information is protected from loss, misuse and unauthorized access, disclosure, alteration and destruction. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. You should keep in mind that no Internet transmission is ever 100% secure or error-free. Where you use log-in credentials (usernames, passwords) on our Website, please remember that it is your responsibility to safeguard them. If you believe that your log-in credentials have been compromised, please contact us at

Children's Information

Our Website and Services are not directed at children under the age of 16 and we do not knowingly collect personal information from children under the age of 16 through our Website and/or Services. If you have reason to believe that a child under the age of 16 has provided personal information to us, please contact us, and we will endeavor to delete that information from our databases.

Links to Other Websites

Our Website and Services may contain links to other websites. The operators of such other websites may collect information about you, including through cookies or other technologies. If you are using our Website or Services and click a link to another site, you will leave our Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We are not responsible for the data collection and use practices of such other sites. This Policy applies solely to the information collected in connection with your use of our Website and Services and does not apply to any practices conducted offline or in connection with any other websites.

Information for EU and Swiss Residents

JD Supra's principal place of business is in the United States. By subscribing to our website, you expressly consent to your information being processed in the United States.

  • Our Legal Basis for Processing: Generally, we rely on our legitimate interests in order to process your personal information. For example, we rely on this legal ground if we use your personal information to manage your Registration Data and administer our relationship with you; to deliver our Website and Services; understand and improve our Website and Services; report reader analytics to our authors; to personalize your experience on our Website and Services; and where necessary to protect or defend our or another's rights or property, or to detect, prevent, or otherwise address fraud, security, safety or privacy issues. Please see Article 6(1)(f) of the E.U. General Data Protection Regulation ("GDPR") In addition, there may be other situations where other grounds for processing may exist, such as where processing is a result of legal requirements (GDPR Article 6(1)(c)) or for reasons of public interest (GDPR Article 6(1)(e)). Please see the "Your Rights" section of this Privacy Policy immediately below for more information about how you may request that we limit or refrain from processing your personal information.
  • Your Rights
    • Right of Access/Portability: You can ask to review details about the information we hold about you and how that information has been used and disclosed. Note that we may request to verify your identification before fulfilling your request. You can also request that your personal information is provided to you in a commonly used electronic format so that you can share it with other organizations.
    • Right to Correct Information: You may ask that we make corrections to any information we hold, if you believe such correction to be necessary.
    • Right to Restrict Our Processing or Erasure of Information: You also have the right in certain circumstances to ask us to restrict processing of your personal information or to erase your personal information. Where you have consented to our use of your personal information, you can withdraw your consent at any time.

You can make a request to exercise any of these rights by emailing us at or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

You can also manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard.

We will make all practical efforts to respect your wishes. There may be times, however, where we are not able to fulfill your request, for example, if applicable law prohibits our compliance. Please note that JD Supra does not use "automatic decision making" or "profiling" as those terms are defined in the GDPR.

  • Timeframe for retaining your personal information: We will retain your personal information in a form that identifies you only for as long as it serves the purpose(s) for which it was initially collected as stated in this Privacy Policy, or subsequently authorized. We may continue processing your personal information for longer periods, but only for the time and to the extent such processing reasonably serves the purposes of archiving in the public interest, journalism, literature and art, scientific or historical research and statistical analysis, and subject to the protection of this Privacy Policy. For example, if you are an author, your personal information may continue to be published in connection with your article indefinitely. When we have no ongoing legitimate business need to process your personal information, we will either delete or anonymize it, or, if this is not possible (for example, because your personal information has been stored in backup archives), then we will securely store your personal information and isolate it from any further processing until deletion is possible.
  • Onward Transfer to Third Parties: As noted in the "How We Share Your Data" Section above, JD Supra may share your information with third parties. When JD Supra discloses your personal information to third parties, we have ensured that such third parties have either certified under the EU-U.S. or Swiss Privacy Shield Framework and will process all personal data received from EU member states/Switzerland in reliance on the applicable Privacy Shield Framework or that they have been subjected to strict contractual provisions in their contract with us to guarantee an adequate level of data protection for your data.

California Privacy Rights

Pursuant to Section 1798.83 of the California Civil Code, our customers who are California residents have the right to request certain information regarding our disclosure of personal information to third parties for their direct marketing purposes.

You can make a request for this information by emailing us at or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

Some browsers have incorporated a Do Not Track (DNT) feature. These features, when turned on, send a signal that you prefer that the website you are visiting not collect and use data regarding your online searching and browsing activities. As there is not yet a common understanding on how to interpret the DNT signal, we currently do not respond to DNT signals on our site.

Access/Correct/Update/Delete Personal Information

For non-EU/Swiss residents, if you would like to know what personal information we have about you, you can send an e-mail to We will be in contact with you (by mail or otherwise) to verify your identity and provide you the information you request. We will respond within 30 days to your request for access to your personal information. In some cases, we may not be able to remove your personal information, in which case we will let you know if we are unable to do so and why. If you would like to correct or update your personal information, you can manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard. If you would like to delete your account or remove your information from our Website and Services, send an e-mail to

Changes in Our Privacy Policy

We reserve the right to change this Privacy Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our Privacy Policy will become effective upon posting of the revised policy on the Website. By continuing to use our Website and Services following such changes, you will be deemed to have agreed to such changes.

Contacting JD Supra

If you have any questions about this Privacy Policy, the practices of this site, your dealings with our Website or Services, or if you would like to change any of the information you have provided to us, please contact us at:

JD Supra Cookie Guide

As with many websites, JD Supra's website (located at (our "Website") and our services (such as our email article digests)(our "Services") use a standard technology called a "cookie" and other similar technologies (such as, pixels and web beacons), which are small data files that are transferred to your computer when you use our Website and Services. These technologies automatically identify your browser whenever you interact with our Website and Services.

How We Use Cookies and Other Tracking Technologies

We use cookies and other tracking technologies to:

  1. Improve the user experience on our Website and Services;
  2. Store the authorization token that users receive when they login to the private areas of our Website. This token is specific to a user's login session and requires a valid username and password to obtain. It is required to access the user's profile information, subscriptions, and analytics;
  3. Track anonymous site usage; and
  4. Permit connectivity with social media networks to permit content sharing.

There are different types of cookies and other technologies used our Website, notably:

  • "Session cookies" - These cookies only last as long as your online session, and disappear from your computer or device when you close your browser (like Internet Explorer, Google Chrome or Safari).
  • "Persistent cookies" - These cookies stay on your computer or device after your browser has been closed and last for a time specified in the cookie. We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.
  • "Web Beacons/Pixels" - Some of our web pages and emails may also contain small electronic images known as web beacons, clear GIFs or single-pixel GIFs. These images are placed on a web page or email and typically work in conjunction with cookies to collect data. We use these images to identify our users and user behavior, such as counting the number of users who have visited a web page or acted upon one of our email digests.

JD Supra Cookies. We place our own cookies on your computer to track certain information about you while you are using our Website and Services. For example, we place a session cookie on your computer each time you visit our Website. We use these cookies to allow you to log-in to your subscriber account. In addition, through these cookies we are able to collect information about how you use the Website, including what browser you may be using, your IP address, and the URL address you came from upon visiting our Website and the URL you next visit (even if those URLs are not on our Website). We also utilize email web beacons to monitor whether our emails are being delivered and read. We also use these tools to help deliver reader analytics to our authors to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

Analytics/Performance Cookies. JD Supra also uses the following analytic tools to help us analyze the performance of our Website and Services as well as how visitors use our Website and Services:

  • HubSpot - For more information about HubSpot cookies, please visit
  • New Relic - For more information on New Relic cookies, please visit
  • Google Analytics - For more information on Google Analytics cookies, visit To opt-out of being tracked by Google Analytics across all websites visit This will allow you to download and install a Google Analytics cookie-free web browser.

Facebook, Twitter and other Social Network Cookies. Our content pages allow you to share content appearing on our Website and Services to your social media accounts through the "Like," "Tweet," or similar buttons displayed on such pages. To accomplish this Service, we embed code that such third party social networks provide and that we do not control. These buttons know that you are logged in to your social network account and therefore such social networks could also know that you are viewing the JD Supra Website.

Controlling and Deleting Cookies

If you would like to change how a browser uses cookies, including blocking or deleting cookies from the JD Supra Website and Services you can do so by changing the settings in your web browser. To control cookies, most browsers allow you to either accept or reject all cookies, only accept certain types of cookies, or prompt you every time a site wishes to save a cookie. It's also easy to delete cookies that are already saved on your device by a browser.

The processes for controlling and deleting cookies vary depending on which browser you use. To find out how to do so with a particular browser, you can use your browser's "Help" function or alternatively, you can visit which explains, step-by-step, how to control and delete cookies in most browsers.

Updates to This Policy

We may update this cookie policy and our Privacy Policy from time-to-time, particularly as technology changes. You can always check this page for the latest version. We may also notify you of changes to our privacy policy by email.

Contacting JD Supra

If you have any questions about how we use cookies and other tracking technologies, please contact us at:

- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.