Usufruct is the ownership structure nobody asks about until the deal is almost signed and then suddenly it is the only thing anyone can talk about.
Usufruct is a civil-law concept imported from French and Roman legal tradition: the right to use, occupy, and earn income from a property for a specified term without holding the underlying freehold. In the UAE it shows up most commonly in Abu Dhabi, where non-GCC nationals can hold usufruct rights for up to 99 years in designated investment zones like Al Reem Island and Saadiyat. In Dubai it appears less often, but exists in certain specific plots and community structures. The usufructuary can live in, rent out, or sometimes even mortgage the property, but cannot sell the underlying land.
A client considering Al Reem Island in 2024 was three weeks into due diligence before he understood that what he was buying was a 99-year usufruct, not a true freehold. The economic difference for a 15-year hold is marginal. For a multi-generational hold, it is material.
In Abu Dhabi, confirm the exact ownership structure in the first meeting. “Freehold equivalent” is a marketing phrase. Usufruct is the legal reality.
Related: Freehold, Leasehold, Title Deed, DLD.