Breaking! U.S. Embassy in Iraq Attacked! Collapsed Over 33% - Middle East Real Estate Giant Crumbles

The world’s most active real estate market faces a trust crisis.

Amid escalating tensions in the Middle East, real estate transactions in the UAE have significantly slowed, with property stocks experiencing heavy sell-offs. Abu Dhabi’s largest publicly listed developer, Aldar Properties, has seen its stock price drop over 33% since the outbreak of conflict. Goldman Sachs states that increasing regional uncertainty is beginning to pressure local real estate demand.

According to the latest report from CCTV News, around 2:30 a.m. local time on the 18th, the U.S. Embassy in Iraq’s Green Zone in Baghdad was attacked. Since the recent escalation of the US-Israel-Iran conflict, the U.S. Embassy in Iraq has been targeted multiple times. Additionally, Xinhua reports that Iranian President Ebrahim Raisi expressed condolences on the early morning of the 18th over the assassination of Iran’s top national security official and former parliamentary speaker, Ali Larijani, vowing revenge. Raisi highly praised Larijani’s contributions during his tenure, stating that as Secretary of the Supreme National Security Council, Larijani worked tirelessly to promote regional peace and security and foster friendly relations among Islamic countries. His death is a significant loss, and the perpetrators will be brought to justice.

Furthermore, the U.S. Central Command announced on the evening of the 17th that U.S. forces used multiple 5,000-pound (about 2.7 tons) bunker-buster bombs to attack Iranian missile sites along the Strait of Hormuz. CCTV International reports, citing Israeli media, that Iran launched missiles at Ramat Gan south of Tel Aviv in central Israel, resulting in two deaths. Tel Aviv-Savidor Central Station was also severely damaged.

Prices Plummet Over 33%

The ongoing escalation of tensions in the Middle East has dealt a heavy blow to confidence in the UAE real estate market. Notably, Abu Dhabi’s largest listed developer, Aldar Properties, has seen its stock price fall more than 33% since the conflict began.

Additionally, Emaar Properties, one of the UAE’s largest developers and the builder of the world’s tallest building, the Burj Khalifa, has seen its stock drop over 30%. Bonds issued by major developers have also declined sharply.

Goldman Sachs notes that since the conflict’s outbreak, the total transaction value in the first half of March has decreased by 31% year-over-year and by 51% month-over-month.

Amid the ongoing regional tensions, investor sentiment toward Dubai’s real estate market remains cautious. The risk-averse mood among overseas investors is rising, and international capital flows are inevitable.

Mohammed Ali Yasin, CEO of Ghaf Benefits under UAE investment giant Lunate, said that only once the conflict subsides can the true impact on the real estate market be assessed based on demand levels.

Reports indicate that after the outbreak of the US-Iran war, there has been a surge in inquiries about relocating assets from the UAE to Singapore. An overseas private wealth lawyer revealed that several Dubai clients are planning to transfer their assets to Singapore immediately.

Economists at Abu Dhabi Commercial Bank point out that after the conflict ends, foreign investors’ confidence and interest in real estate will be crucial. Non-resident and expatriate buyers will be key demand drivers, especially from the second half of 2026 onward, when new housing supply is expected to increase and remain high over the next two years.

If foreign investor enthusiasm remains low, a significant vacancy rate for luxury villas and off-plan apartments in the UAE is likely.

Some analysts warn that if the war continues, mutual distrust between Iran and the UAE could deepen, damaging the long-cultivated image of the UAE as a “safe” and “open” destination.

It’s worth noting that real estate is a core pillar of Dubai’s economy, contributing about 15% to its GDP through real estate and construction sectors.

Before the outbreak of regional conflicts, Dubai was one of the top destinations for global real estate investors. According to Fitch Solutions, property prices in Dubai surged 60% from 2022 to the first quarter of 2025.

Data from CBRE shows that in 2025, Abu Dhabi’s residential transactions are expected to increase by 50% year-over-year, with values rising 61%, and overall residential prices increasing nearly 32%. Dubai’s residential sales last year grew by 13%. The rental market remains active, with Abu Dhabi’s average rent rising 22% annually and Dubai’s about 6%.

However, some senior executives in the Middle Eastern real estate sector remain optimistic about the long-term outlook.

Ziad El Chaar, CEO of Dar Global, a leading luxury real estate developer, stated that the Gulf Cooperation Council countries have strong fundamentals. He believes the current downward cycle will pass quickly and emphasized that no projects have been shelved; everything is proceeding as planned.

U.S. Embassy in Iraq Attacked

Currently, tensions in the Middle East show no signs of easing. On March 18, CCTV News reported that at around 2:30 a.m. local time, the U.S. Embassy in Baghdad’s Green Zone was attacked. Since the recent escalation of the US-Israel-Iran conflict, the embassy has been targeted multiple times.

Xinhua reports that on March 17, Reuters quoted Iran’s Supreme Leader Ayatollah Ali Khamenei as rejecting a proposal for de-escalation or ceasefire with the U.S. The mediating countries conveyed this proposal to Iran.

Reuters also cited a senior Iranian official saying that during his first diplomatic policy meeting, Khamenei took a “firm and serious” stance against the U.S. and Israel. He believes that “peace is only possible once the U.S. and Israel admit defeat and pay reparations.”

On March 17, Iran’s Islamic Revolutionary Guard Corps announced that Iranian armed forces had launched “effect-oriented” operations in the region.

The IRGC issued a statement that a new round of operations, called “Real Commitment-4,” began early that morning, characterized by “effectiveness” and “precision strikes,” utilizing heavy-duty guided weapons, multi-warhead missiles, and attack drones.

The statement said the results of this round of operations would be continuously communicated to the Iranian public.

According to CCTV News, from early morning on the 17th until around 9 a.m., Israel’s Defense Forces detected two Iranian missile launches toward Israel, triggering air raid alerts in northern and central Israel.

The IDF reported that both Iranian missile attacks were limited in number and successfully intercepted. Hezbollah in Lebanon also continued to fire rockets and drones at Israel. Multiple air raid alerts sounded in northern Israel.