Ran the numbers on a Business Bay studio — 8%+ net yield actually exists in 2026, but it comes with real trade-offs
Been analysing Business Bay inventory lately and one unit stood out, both for the numbers and the catches. Sharing the full breakdown because I rarely see honest math on this sub.
The unit: Aykon City Tower B (DAMAC, handed over late 2023). Studio, 427 sqft, high floor, vacant, never lived in.
The math:
- Asking: 830k. DLD data puts the building average for studios around 889k, so entry is below market
- Long-term rents in the tower: 75k–85k (actual signed contracts, not broker projections)
- Service charges: ~11k/year
- Net yield after service charges: roughly 7.7–8.9%
- Liquidity: Aykon City recorded ~384 DLD sale transactions in the last 12 months. That's exit-in-weeks territory, not months
Now the flaws, because nothing yielding 8% is free:
- It's a serviced/hotel-style tower. Some banks are picky with mortgages on these and many units move cash-only. If you're a mortgage buyer, get pre-approval on the specific building before falling in love with the yield
- 17% management fee if you rent through the building's rental pool. That 8.9% becomes ~7.3% real quick. Self-managing avoids it, but then tenant headaches are yours
- Service charges are high per sqft — 11k on 427 sqft is ~26/sqft, nearly double a standard residential tower. Branded amenities aren't free
- 1,200+ units in one tower. When 30 identical studios hit the rental market at once, you compete on price. Rent softness always hits studios first
- Studios lag on appreciation. 1BRs will out-appreciate this unit. This is a cash-flow play, not a capital-growth play — buy it for the yield or don't buy it
- Business Bay has a heavy handover pipeline through 2026–27. Rents have held so far, but nobody can promise 85k stays 85k
- Marasi Drive at 6pm. If you know, you know
My take: right buy for someone who wants rental income + easy exit and has cash (or verified financing). Wrong buy if you're chasing capital growth or want something "premium" to hold long term.