Prolonged regional tensions and disruptions in the Strait of Hormuz are pushing up project costs and tightening lending conditions, with smaller UAE property firms most vulnerable amid growing geopolitical uncertainties, according to Fitch Ratings.
A prolonged conflict involving Iran could tighten liquidity for property developers in the UAE, with smaller firms likely to feel the strain first, according to Fitch Ratings. The agency said the risk is rising as disruption around the Strait of Hormuz continues to complicate supply chains and push up the upfront costs of projects before construction even gets under way.
Fitch said borrowing conditions across the Gulf have also worsened, with debt costs reaching five-year highs as geopolitical risk has increased. That has made conventional bank lending more costly and more difficult to obtain, particularly for smaller developments that lenders now view as higher risk.
Paul Lund, Fitch’s head of corporate ratings for the Middle East and Africa, said liquidity is still present in the market because real estate in Abu Dhabi and Dubai is heavily regulated, with investor money held in escrow and released according to completion milestones. But he warned that if the conflict drags on, committed buyers could become more cautious or withdraw, forcing developers to scale back schemes or push delivery further out. He added that the pace at which firms develop their land banks can quickly absorb cash, and said some builders are leaning more towards villa projects because they are easier to manage on timing.
Investor confidence has already become a central concern. Fitch said it has placed some Dubai home builders, including Binghatti and Omniyat, on ratings watch, noting that both began from relatively strong positions with solid liquidity and substantial escrow balances. The agency also pointed to bond deals used to support their development programmes. Bloomberg reported in late March that the sukuk issued by both developers had come under pressure as credit-quality and refinancing worries deepened.
Both companies have pushed back against the market anxiety. Binghatti said its construction activity remains fully operational and on schedule, and that cancellation rates are still in line with historical levels of below 1%. Omniyat said it continues to advance delivery across its portfolio, with what it described as a fully funded $11.7 billion pipeline progressing as planned.
At the same time, Dubai has been trying to support demand. A new Metro Gold Line is expected to improve access to harder-to-reach communities, while recent property reforms have lowered the threshold for two-year, property-linked visas and tightened joint-ownership rules so that each investor’s stake must be at least AED 400,000. Tauseef Khan, founder and chairman of Dugasta Properties, said the changes reduce entry barriers and widen the pool of buyers able to plan a long-term future in the emirate.
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Source: Noah Wire Services
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The article presents recent insights from Fitch Ratings regarding the impact of the Iran conflict on UAE real estate developers. Similar analyses have been published in the past month, indicating that the content is current. However, the specific publication date of the original article is not provided, making it challenging to confirm its exact freshness. ([tradingview.com](https://www.tradingview.com/news/reuters.com%2C2026-03-12%3Anewsml_ZawbYYNVY%3A0-zawya-news-uae-developers-likely-to-scale-back-projects-but-face-no-imminent-financial-risks-fitch/?utm_source=openai))
Quotes check
Score:
7
Notes:
The article includes direct quotes from Paul Lund, Fitch’s head of corporate ratings for the Middle East and Africa. While these quotes are attributed to him, without access to the original source, it’s difficult to verify their authenticity. ([tradingview.com](https://www.tradingview.com/news/reuters.com%2C2026-03-12%3Anewsml_ZawbYYNVY%3A0-zawya-news-uae-developers-likely-to-scale-back-projects-but-face-no-imminent-financial-risks-fitch/?utm_source=openai))
Source reliability
Score:
6
Notes:
The article originates from Zawya, a news platform that aggregates content from various sources. While it provides valuable information, the lack of direct access to the original Fitch Ratings report raises concerns about the independence and reliability of the information presented. ([tradingview.com](https://www.tradingview.com/news/reuters.com%2C2026-03-12%3Anewsml_ZawbYYNVY%3A0-zawya-news-uae-developers-likely-to-scale-back-projects-but-face-no-imminent-financial-risks-fitch/?utm_source=openai))
Plausibility check
Score:
8
Notes:
The claims regarding liquidity concerns among UAE real estate developers due to the Iran conflict align with recent reports from reputable sources. For instance, Bloomberg highlighted the impact of the conflict on Dubai real estate bonds, noting significant losses and market challenges. ([bloomberg.com](https://www.bloomberg.com/news/articles/2026-03-13/war-threatens-abrupt-end-to-uae-real-estate-bond-bonanza?utm_source=openai))
Overall assessment
Verdict (FAIL, OPEN, PASS): FAIL
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The article discusses liquidity concerns among UAE real estate developers amid the Iran conflict, citing insights from Fitch Ratings. However, the lack of direct access to the original Fitch report and reliance on aggregated content from Zawya raises concerns about the accuracy and reliability of the information presented. ([tradingview.com](https://www.tradingview.com/news/reuters.com%2C2026-03-12%3Anewsml_ZawbYYNVY%3A0-zawya-news-uae-developers-likely-to-scale-back-projects-but-face-no-imminent-financial-risks-fitch/?utm_source=openai))
