Permira and Blackstone bet on Dubai real estate with Property Finder deal
By Chloe Cornish
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2 Min Read
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Private capital groups take $525mn stake in Middle Eastern real estate portal after sale prices surge
Private capital firms Permira and Blackstone are buying a $525mn stake in a Middle Eastern real estate classifieds business in a bet that a boom in Dubai’s real estate market has further to run.
The investors are purchasing part of a stake in online portal Property Finder held by private equity firm General Atlantic. The deal values Property Finder at $2bn, a person familiar with the matter said.
Permira, which has invested in online classifieds businesses in other countries, is the lead investor on the deal and has invested $350mn.
Property Finder’s main business is in the United Arab Emirates, where Dubai, the region’s commercial hub, is in its third property bull run since it opened to foreign investment in the early 2000s.
Average sale prices per square foot in Dubai have soared 68 per cent in the past six years, according to data analytics firm Reidin.
Michael Lahyani, who founded Property Finder in 2007, said the growth was mainly driven by the UAE’s expanding population. Dubai’s population surpassed 4mn people this month, according to official estimates, having increased by a fifth in six years.
Lahyani, who is still chief executive and a shareholder in Property Finder, predicted Dubai real estate values would grow by more than 20 per cent per annum for “for another year or two” before slowing to a “more sustainable number”.
Not everyone is convinced that Dubai’s property surge can continue. Rating agency Fitch has forecast a downturn in the second half of this year, as it expects a flood of new homes to hit the market.
The city’s two previous property booms ended in busts. Its first bubble burst following the 2008 global financial crisis, while a second rally — stoked by regional investors looking for a safe haven after the 2011 Arab spring — went into reverse in 2015.
General Atlantic initially invested in Property Finder, which also operates in Egypt, Saudi Arabia, Qatar and Bahrain, during another market downturn in 2018.
Lahyani argued that this time around “the property market is in a very different shape . . . it is not leveraged like it was back in the day”, he said, adding that growth was coming from rising sales volumes.
Dubai’s land department recorded 125,538 real estate transactions in the first half of this year, a 26 per cent increase on the same period in 2024.
Permira and Blackstone pointed to high rental yields and low vacancies in Dubai’s real estate market, adding that classifieds businesses tend to perform well in downturns regardless.
David Erlong, partner and global co-head of consumer at Permira, said there was plenty of room for classifieds businesses to grow in the UAE as they were used by relatively fewer consumers than in more mature markets.
“We’re huge believers in the Gulf region, the UAE, Dubai in particular,” said Paul Morrissey, head of Blackstone Growth in Europe, adding that the firm believed economic growth in the region “has a huge way to run”.
Chris Caulkin, General Atlantic’s technology head in the Emea region, said the private equity firm had “retained a very, very large portion of our investment. But also we think it’s the right thing for the company to start bringing in a broader shareholder group”.
Dubai’s risky decision to quickly reopen during the pandemic in 2020 made it one of few cities accessible for tourists and business travellers, fuelling renewed interest in its real estate.
Meanwhile, changes to the UAE’s visa regime have encouraged foreign workers — the vast majority of the country’s population — to stay for longer periods.
Dubai’s property market has also benefited from an influx of demand from those fleeing the consequences of Russia’s invasion of Ukraine, while the emirate’s embrace of cryptocurrency meant many newly minted bitcoin millionaires bought homes too.
