A Dubai Landmark Hotel Becomes Offices: What the AHS Twin Towers Plan Says About the Office Squeeze

DUBAI — One of Sheikh Zayed Road’s best-known hotels is becoming an office building. AHS Properties plans to convert the Shangri-La Dubai into AHS Twin Towers, a US$1.3 billion Grade A commercial development, following its AED 1.1 billion purchase of the property, according to a company announcement carried by Business Wire.

The developer says high-end office space is now a better use of the site than a five-star hotel. That tells founders a lot about how scarce quality office space has become in central Dubai.

The Project

According to the announcement and a Zawya Projects report:

• The twin-tower building will be redeveloped as ground plus 50 floors of Grade A offices.
• Gensler is the architect, with interiors by AHS Atelier, the developer’s in-house design studio.
• Amenities include more than 30,000 sq ft of wellness and fitness space, over 12,000 sq ft of dining, executive business lounges, a lap pool, a rooftop sky garden and more than 1,000 parking spaces.

Forbes Middle East reports the project will cover more than one million square feet and is on track for delivery in the second quarter of 2028. Founder and CEO Abbas Sajwani told the publication that the refurbishment replaces the lifts and all mechanical, electrical and plumbing systems.

Sold, Not Leased

The way the space is being sold matters to anyone thinking about an office there. Sajwani told Forbes Middle East that:

• AHS is selling floors rather than leasing them, while keeping some floors to rent out once the building is complete.
• Prices start at about AED 3,850 to AED 4,000 per sq ft and rise to AED 5,000 per sq ft.
• Floors are sold as shell and core, with fit-out offered at cost closer to completion.
• Owners will pay a service charge of about AED 20 per sq ft.
• The project is funded by off-plan sales, with no bank financing.

In a Gulf Business interview, Sajwani said more than 30% of the building is already booked. He said full floors measure about 16,000 sq ft, with half-floor options also available. He pointed to office yields and said occupancy rates are “over 95 per cent.” (That figure is his own; Gulf Business did not give a source for it.)

The company says its first Grade A commercial project, AHS Tower, sold out for more than US$700 million during development.

There is also a licensing detail for financial-sector founders. Sajwani told Forbes Middle East that because the tower is on the Dubai mainland, a DIFC-licensed company can use space there as a second office, but not as its licensed main office.

What the Wider Market Shows

The conversion comes as office demand stays steady and new supply stays limited. Savills’ Dubai Office Market Report for Q3 2026 recorded:

• About 20,200 office rental transactions, down 8% from the previous quarter.
• Average rents stable at about AED 241 per sq ft.
• New leases at 51% of activity, against 49% renewals.
• Offices under 1,000 sq ft at 66% of transactions, and units under 500 sq ft at 40%, according to Zawya’s summary of the report.

Savills expects limited new supply in 2026, with development activity increasing from 2028 onwards. It says prime, well-connected, ESG-compliant buildings should outperform while secondary buildings may take longer to lease. It also notes that demand for Grade A space is being supported by international businesses, including fintech firms and Chinese companies.

Buying is picking up too. CRC Property, citing Dubai Land Department data via Property Monitor, counted 1,123 office units sold in Q3, up 11.7% from the previous quarter, with an average deal size of AED 3.87 million.

What It Means for Founders

This is our editorial reading of the data.

• Most startups won’t buy a whole floor. A full floor at AHS Twin Towers costs tens of millions of dirhams. Its main effect on early-stage companies is indirect: it adds premium space in 2028, which could ease pressure in the Sheikh Zayed Road and DIFC area once tenants move.
• Small offices are where the market is busiest. With two-thirds of leases under 1,000 sq ft, a small team competes with many others for the same units. Plan early, and compare serviced and co-working options.
• Check your licence before you sign. As the DIFC example shows, whether a building is in a free zone or on the mainland affects which offices can serve as your registered address.
• Owning is an option for later-stage companies. For profitable firms with a long horizon, rising office sales and active trading in smaller strata units are making ownership a realistic alternative to renting.

Figures come from AHS Properties via Business Wire, Zawya, Forbes Middle East, Gulf Business, Savills and CRC Property as of October 29, 2026. Developer statements on bookings and occupancy have not been independently verified.