Reshaping Property Management in Abu Dhabi: Key Changes Under Decision 25/2025

Introduction

The Emirate of Abu Dhabi has recently taken an additional step to strengthen the regulatory framework governing its real estate sector with the issuance of a significant administrative decision by the Chairman of the Department of Municipalities and Transport (“DMT“). Administrative Decision No. 25/2025, issued on 24 November 2025, provides a comprehensive regime for the regulation of ownership, usufruct controls, and the management of real estate, common areas, and facilities in the Emirate (“Decision 25“). Decision 25 came into force and effect on 28 February 2026.

Decision 25 is issued pursuant to Abu Dhabi Law No. 3/2015 on the Regulation of the Real Estate Sector in the Emirate of Abu Dhabi (as amended) (the “Law“), which serves as the principal legislative framework for the sector. This article examines some of the key provisions of Decision 25 and considers its practical implications for developers, unit owners, management companies, and other stakeholders in Abu Dhabi’s real estate market.

Administrative Decision No. 25/2025 — Ownership, Usufruct Controls, and Management of Real Estate

Overview and Scope

Administrative Decision No. 25/2025 addresses a broad spectrum of matters including common areas and facilities, ownership and co-ownership structures, management and operation of jointly owned properties, service fees and complex fees, annual budgets and financial affairs, disclosure obligations, and general procedural provisions.

Common Areas and Ownership Structure

Decision 25 provides detailed definitions and delineation of common areas in both strata plans and site plans. Unless otherwise specified, the common areas in a strata plan include the structural components of the building, guard rooms, recreational equipment and pools, elevator and utility systems, main pipes and electrical conduits, meters and supply systems, and any service facilities serving the common areas. For site plans, common areas include roads, roundabouts, drainage systems, lakes, parks, green areas, playgrounds, and utility infrastructure.

Importantly, none of the common areas or their associated movable property may be sold, disposed of, mortgaged, or encumbered with debts. Common facilities may not be disposed of, exploited, altered, re-planned, or abolished except with the prior approval of the DMT, the Centre, and the competent entities, and any such action must not affect the rights of unit owners under their sale agreements.

Each real estate unit is allocated a contribution percentage, determined in the strata plan or site plan by reference to the unit’s area as a proportion of the total area. The Centre may approve a change in the contribution percentage upon the request of a majority of not less than two-thirds of the owners of the jointly owned property.

Rights and Obligations of Owners and Occupants

Owners are obliged to comply with the provisions of the applicable site management system or strata management system. The owner and occupant of a real estate unit and their guests must use the common areas for their intended purpose in a manner that does not infringe on the rights of others, cause them inconvenience, or endanger safety. No material alterations, changes, or additions to the structure or external appearance of the unit may be made without the prior written approval of the developer or management company.

Management Companies

Decision 25 establishes a detailed framework for the appointment and regulation of management companies. Developers must appoint a management company that has been accredited by the Centre to manage, operate, maintain, and repair the common areas and service facilities within thirty days from the date of delivery of the first real estate unit. The term of the management company appointment agreement, or any renewal thereof, may not exceed three consecutive years without the approval of the Centre. The agreement appointing the management company must include an express clause providing the developer with the right to terminate and rescind the agreement without recourse to the courts in the event the management company breaches any obligation and fails to remedy the breach within thirty days of written notification.

The Chairman has the authority to designate certain projects in which the developer shall assume management responsibility through an accredited specialized company, with the Owners Committee exercising only such powers as the Chairman determines.

The developer is prohibited from renewing the appointment with a management company that has committed specified acts of failure or negligence during its term, including failure to maintain the jointly owned property or common facilities, or failure to carry out maintenance works requested by the Centre.

The management company must use an electronic management and accounting system, provide periodic reports to the Centre every six months on the management of jointly owned properties, and hand over all books and records to the developer or successor upon the termination of its appointment.

Service Fees and Complex Fees

The decision provides a comprehensive regime for service fees. Each unit owner must pay to the management company its share of service fees, determined in proportion to the area of the unit relative to the total area of the jointly owned property. The developer bears its share of service fees in respect of unsold units and is also responsible for all costs and expenses relating to a unit accruing prior to handover, unless the owner has refused or delayed taking over the unit for reasons beyond the developer’s control.

Crucially, service fees may not be imposed unless approved by the Centre after the DMT’s approval, and any service fees claimed without such approval are deemed unlawful, have no legal effect, and may not be imposed, demanded, or collected. Annual service fees must be payable in monthly or quarterly instalments, and the owner may not be compelled to pay them in a single annual lump sum. The management company holds a preferential right on the unit and its appurtenances for the collection of service fees, which right remains enforceable against any new owner upon a change of ownership.

Detailed procedures are prescribed for the collection of overdue service fees, including certification by an accredited auditor, written notification through a notary public, and the issuance by the Centre of a document evidencing the management company’s right to overdue fees, which document has the power of a writ of execution. The Centre may also place a restriction in the real estate unit’s register preventing any disposal until the due amounts are paid.

Similarly, the master developer may not impose complex fees for the use of common facilities unless approved by the Centre. Any complex fees claimed without such approval are deemed unlawful and may not be imposed or collected.

Supply Agreements

The management company is restricted from entering into supply agreements whose costs directly or indirectly affect service fees, or which result in the developer or management company earning profits for itself, without the prior approval of the Centre. Supply agreements may not exceed two years without the Centre’s approval, and in no case may their duration exceed twenty years. Detailed content requirements for supply agreements are prescribed, including competitive pricing, performance monitoring provisions, termination rights, and prohibitions on secret commissions.

Financial Affairs and Insurance

The annual budget of the jointly owned property must consist of the service fees, including estimates of income and expenses, and must include a contribution to a reserve bank account for emergencies and equipment replacement. The annual budget may not include fees related to agreements that contravene the Law or this Decision, or fees related to the recovery of capital costs. The Centre has the power to approve, reject, or require amendments to the annual budget.

The management company is required to insure the common areas and the jointly owned property for an amount sufficient to cover repair or reconstruction, and must also maintain insurance against damage and bodily injuries sustained by unit owners, occupants, or third parties.

Disclosure Requirements

Decision 25 imposes significant disclosure obligations on developers and reselling purchasers. Before a purchaser signs a purchase contract for a real estate unit, the developer must attach a disclosure statement containing, amongst other matters, details describing the building or project, the extent of sustainable environmental development measures, availability of facilities, a copy of the applicable management system, a draft plan, an estimate of service fees for the first two fiscal years, and estimated dates for commencement of works and handover to the purchaser.

The developer must ensure the accuracy of such information, and if any information is found to be materially inaccurate or incomplete within two years from the date of transfer, the developer shall be liable to the purchaser who suffers damages.  If however the developer fails to provide the required disclosure data at all , the purchaser may request the rescission of the contract.

Practical Implications

Decision 25 introduces a detailed and prescriptive regime for the ongoing management and governance of jointly owned properties and common areas. The emphasis on the Centre’s approval for service fees and complex fees, the restrictions on supply agreements, and the enhanced disclosure obligations collectively aim to promote transparency and protect the interests of unit owners and occupants. The requirement for management companies to use electronic management and accounting systems and to provide regular reporting to the Centre reflects a broader trend towards digital governance in the Emirate.

Conclusion

Decision 25 demonstrates Abu Dhabi’s continued commitment to maturing and modernizing  its real estate sector through the implementation of international real estate standards  and norms and the provision of further protections to the individual buyers in the market. Developers, management companies, and all other market participants should carefully review the decision and assess their compliance obligations in light of the new requirements. All stakeholders involved in the management of jointly owned properties should familiarise themselves with the detailed requirements of Decision 25 relating to management company appointments, service fee approvals, supply agreements, and disclosure obligations to ensure compliance.