Office rents for Dubai's financial services sector dropped during the first half of the year as banks slashed staff numbers and delayed investment in new offices, but rental rates in some locations displayed signs of stabilisation. As banking sector job losses bite Gregor Hunter looks at dropping rental rates. Yearly rents for office space within the <a href="gopher://topicL3RoZW5hdGlvbmFsL09yZ2FuaXNhdGlvbnMvRElGQw==" inlink="topic::L3RoZW5hdGlvbmFsL09yZ2FuaXNhdGlvbnMvRElGQw==">Dubai International Financial Centre</a> and surrounding office towers fell 18 per cent to an average of Dh330 per square foot (US$89.85 per square foot), according to a new report by CB Richard Ellis. Many financial services companies have made layoffs this year, including <a href="gopher://topicL3RoZW5hdGlvbmFsL09yZ2FuaXNhdGlvbnMvQ29tcGFuaWVzL1VBRSBjb21wYW5pZXMvU2h1YWE=" inlink="topic::L3RoZW5hdGlvbmFsL09yZ2FuaXNhdGlvbnMvQ29tcGFuaWVzL1VBRSBjb21wYW5pZXMvU2h1YWE=">Shuaa Capital</a>, <a href="gopher://topicL3RoZW5hdGlvbmFsL09yZ2FuaXNhdGlvbnMvQ29tcGFuaWVzL1dvcmxkd2lkZSBjb21wYW5pZXMvSFNCQyBIb2xkaW5ncw==" inlink="topic::L3RoZW5hdGlvbmFsL09yZ2FuaXNhdGlvbnMvQ29tcGFuaWVzL1dvcmxkd2lkZSBjb21wYW5pZXMvSFNCQyBIb2xkaW5ncw==">HSBC</a> and <a href="gopher://topicL3RoZW5hdGlvbmFsL09yZ2FuaXNhdGlvbnMvQ29tcGFuaWVzL1dvcmxkd2lkZSBjb21wYW5pZXMvQmFyY2xheXM=" inlink="topic::L3RoZW5hdGlvbmFsL09yZ2FuaXNhdGlvbnMvQ29tcGFuaWVzL1dvcmxkd2lkZSBjb21wYW5pZXMvQmFyY2xheXM=">Barclays Bank</a>, following a drought in dealmaking since the start of the Arab Spring and a growing sense of economic malaise. New buildings coming online in the DIFC are expected to put pressure on rental rates, such as The Index, the Norman Foster-designed tower that looms over the emirate's financial free zone. However, the real estate advisory firm noted a halt to the decline in rents in prime locations in buildings owned by a single landlord. "Prime locations with developed infrastructure and community facilities will continue to attract the interest of investors and occupiers alike and will outperform the wider market during the remainder of the year," the report said. However, a darkening economic outlook was staying the hand of financial services companies looking to expand to Dubai. "A weak outlook for the global economy and ongoing regional unrest has resulted in further constraints being applied to capital expenditure spend, delaying the decision making process for corporate occupiers," , the report added. There were some signs of life in the market, however, with Barclays Capital leasing an additional 8,500 square feet of office space in the DIFC to house an increased number of staff. Goldman Sachs, Standard Bank and Citibank all leased extra office space in the DIFC in the second quarter of the year.