GCC Coworking Demand Rises as Global Firms Shift to Flexible Office Models

Demand for flexible coworking spaces is rising across the Gulf Cooperation Council (GCC) as international corporations and small-to-medium enterprises (SMEs) shift away from traditional long-term leases. The trend is primarily driven by regulatory changes in Saudi Arabia and a tightening office supply in the UAE’s major business hubs. Corporate Migration and Regulatory Drivers A significant portion of the demand originates from Saudi Arabia’s Regional Headquarters (RHQ) program. As of January 2024, foreign firms seeking government contracts in the Kingdom must establish a local base. This mandate has forced hundreds of multinational companies to seek immediate office solutions in Riyadh, where Grade A office vacancy rates have dropped below 5%. Flexible workspaces allow these entities to establish a legal presence without the lead time required for traditional office fit-outs. In the UAE, the demand is concentrated in Dubai and Abu Dhabi. Dubai’s office market recorded a sharp increase in occupancy during 2023 and the first half of 2024, with prime locations in the Dubai International Financial Centre (DIFC) and Business Bay reaching near-total capacity. The growth of the UAE’s…