Abu Dhabi's Department of Municipalities and Transport (DMT), through the Abu Dhabi Real Estate Centre (ADREC), has issued a package of four administrative decisions implementing Real Estate Law No. 3 of 2015 (as amended by Law No. 2 of 2025). Together they set the executive framework for how project escrow accounts are drawn down, how jointly owned properties and common areas are managed, how owners' committees are constituted, and what compensation and refunds apply when an off-plan purchaser defaults. The decisions tighten governance across the development, sale and management cycle and materially reshape the risk allocation between developers, purchasers and unit owners.
Who should read this
Abu Dhabi real estate developers and their escrow trustees and banks; off-plan purchasers and investors; unit owners and owners' committees; and property and community management companies. Anyone holding, selling or managing off-plan or jointly owned property in the emirate should review their contracts and procedures against these decisions.
Directly affected
Key facts
- Issuing authority: Abu Dhabi Department of Municipalities and Transport (DMT), through the Abu Dhabi Real Estate Centre (ADREC).
- Enabling law: Law No. 3 of 2015 Concerning the Regulation of the Real Estate Sector in the Emirate of Abu Dhabi, as amended by Law No. 2 of 2025. The decisions implement — they do not repeal — that law.
- A four-decision package covering distinct stages of the development, sale and management cycle for real estate projects in the emirate.
- Escrow disbursement (Decision No. 24 of 2025): controls on drawing funds from a project's escrow account before an early construction milestone, reinforcing the statutory bar on early withdrawals until roughly 20% of construction is complete.
- Jointly owned property (Decision No. 25 of 2025): rules on ownership rights and the management of jointly owned properties and common areas.
- Owners' committees (Decision No. 26 of 2025): a unified bylaw for owners' committees, with committees to be formed once a threshold share of units is registered to multiple owners, members elected by electronic one-owner-one-vote ballot, developers excluded, and ADREC approval of elected members.
- Off-plan default (Decision No. 165 of 2025): compensation ratios, refund periods and resale procedures where a purchaser defaults, with graduated developer retention scaling by construction stage and ADREC discretion in defined cases.
Decision numbers and thresholds above are drawn from the ADREC announcement and leading practitioner summaries; the enacted Arabic text of each decision prevails on precise figures and definitions.
Executive summary
Abu Dhabi has moved Law No. 3 of 2015 from principle to operating detail. Rather than a single new statute, the emirate has issued four executive decisions that each govern a discrete point of friction in the property lifecycle: when a developer may take money out of escrow, how shared buildings are run, how owners organise and vote, and what happens financially when an off-plan buyer walks away. For developers, the practical effect is tighter cash-flow discipline and stricter governance obligations. For purchasers and owners, the effect is stronger protection of deposits, clearer routes to collective decision-making, and a defined refund regime. The decisions build on — and do not replace — Law No. 3 of 2015 as amended by Law No. 2 of 2025.
Key provisions
Escrow disbursement (Decision No. 24 of 2025). The Real Estate Law already requires developers to route off-plan purchaser payments into a project-specific escrow account and blocks withdrawals until an early construction milestone — commonly stated as around 20% of construction complete. Decision No. 24 sets the mechanism and controls for disbursement in that early window, tightening how and when trustees may release funds and reinforcing that money is tied to construction progress rather than the developer's general working capital.
Jointly owned property (Decision No. 25 of 2025). This decision addresses ownership rights and the management of jointly owned properties and common areas — the service-charge, maintenance and shared-facility questions that dominate strata-style developments. It gives ADREC a clearer footing to regulate how common areas are administered and how the interests of individual owners are protected within a shared scheme.
Owners' committees (Decision No. 26 of 2025). A unified bylaw now governs owners' committees across the emirate. Committees are formed once a threshold share of units in a development is registered to multiple owners; members are resident unit owners elected through a secure electronic ballot on a one-owner-one-vote basis; developers are excluded from membership; and ADREC approves the elected members. This standardises what had been an inconsistent area and gives owners a defined governance channel.
Off-plan default, compensation and refunds (Decision No. 165 of 2025). Where a purchaser defaults on an off-plan sale contract, this decision sets the financial consequences. If the project has not started for reasons outside the developer's control, the purchaser is refunded; as construction advances, developers may retain a graduated portion of the price that increases with the stage of completion, and ADREC retains discretion in defined cases, including where a purchaser has already paid a substantial share of the price. The decision also addresses resale of cancelled units. Exact retention percentages and refund periods are fixed by the decision's Arabic text.
Practical implications
Developers should re-map project cash-flow assumptions against the escrow controls, confirm trustee arrangements comply with Decision No. 24, and update standard sale and purchase agreements so that default, retention and refund clauses track Decision No. 165 rather than legacy contractual formulas. Management arms should review how they administer common areas and how they hand governance to owners' committees.
Purchasers and investors gain more predictable outcomes on both deposit protection and exit, but should read the retention ladder carefully before signing — the cost of defaulting now scales with construction progress, and the refund position differs sharply depending on whether the project has started.
Unit owners and committees should align (or re-constitute) their committees with the unified bylaw, including the election mechanics and the exclusion of developers, and confirm ADREC approval of members.
Property and community managers should audit service-charge and common-area practices against Decision No. 25 and the standardised committee framework.
Action points
- Obtain the Arabic texts of Decisions No. 24, 25, 26 of 2025 and No. 165 of 2025 and confirm the precise thresholds, percentages and effective dates that apply to your projects.
- Review project escrow agreements and trustee mandates against the disbursement controls in Decision No. 24.
- Update off-plan sale and purchase agreements — particularly default, retention, refund and resale clauses — to reflect Decision No. 165.
- Reconstitute or verify owners' committees against the unified bylaw (formation threshold, electronic voting, developer exclusion, ADREC approval).
- Audit common-area management, service charges and jointly owned property arrangements against Decision No. 25.
- Diarise any transitional deadlines and flag existing contracts or committees that need to be brought into compliance.
Directly affected: developers and their escrow trustees and banks; off-plan purchasers and investors; unit owners and owners' committees; and property and community management companies operating in Abu Dhabi.
Enforcement and disputes
ADREC supervises implementation and approves owners' committee members, and several of these decisions expressly reserve regulator discretion — notably on retention in off-plan default cases. Off-plan refund and retention disputes, escrow release disputes and owners' committee governance challenges are the most likely flashpoints. Where a contract predates these decisions, the transitional terms of each decision and ADREC's guidance determine how it is treated, and the enacted Arabic text governs. Parties with live or contemplated disputes should assess their position against the new framework before relying on older contractual mechanics.
Sources and authorities
Primary instrument: Law No. 3 of 2015 Concerning the Regulation of the Real Estate Sector in the Emirate of Abu Dhabi, as amended by Law No. 2 of 2025 — implemented (not repealed) by Administrative Decisions No. 24, 25 and 26 of 2025 and Decision No. 165 of 2025.
Regulator: Abu Dhabi Department of Municipalities and Transport (DMT) / Abu Dhabi Real Estate Centre (ADREC).
Announcement: ADREC — regulatory decisions to enhance transparency and governance in the real estate sector
Captured: 2026-05-26T09:53+00:00Z. Precise figures cross-checked against leading practitioner analyses; the enacted Arabic text prevails.
Instrument details
Enabling law: Law No. 3 of 2015 (Regulation of the Real Estate Sector, Emirate of Abu Dhabi), as amended by Law No. 2 of 2025.
Implementing decisions:
- Administrative Decision No. 24 of 2025 — escrow account disbursement controls before the early construction milestone.
- Administrative Decision No. 25 of 2025 — ownership rights and management of jointly owned property and common areas.
- Administrative Decision No. 26 of 2025 — unified bylaw for owners' committees.
- Decision No. 165 of 2025 — compensation, refund periods and resale procedures on off-plan purchaser default.
Decision numbers and thresholds reflect the ADREC announcement and practitioner summaries. This is an English-language summary; the enacted Arabic text of each decision is authoritative on precise figures, definitions and effective dates.
Based on the four ADREC / DMT decisions implementing Law No. 3 of 2015 (as amended by Law No. 2 of 2025) and cross-checked against leading practitioner analyses. General information only — it does not constitute legal advice, and the enacted Arabic text prevails. For advice on a specific matter, please contact us. Last updated: 2 July 2026.