The tourism sector is one of the major components of the Oman government`s diversification plan. The government has undertaken lot of measures to revive the sector, starting with the establishment of the Ministry of Tourism in 2004. The freehold ownership law which allows foreigners to own real estate in designated integrated tourism-related areas on a freehold basis is another sign of the government`s commitment to revive the sector. The government is also granting subsidised land to major developers for tourism projects. Accordingly, tourism related projects such as the Wave, Blue City, Muscat Golf & Country Club, and Yitti have snowballed in Oman.

The hotel business in Oman has picked up last year after a long period of recession, which is evident from the strong financial performance of hotel operators in 2005. Hotel occupancy rates are almost 100%, and there is already a massive shortage of hotel rooms in Oman. Around 1000 hotel rooms will be needed in the upcoming 3 years to satisfy the increasing demand mainly from European tourists.

The real estate market in Oman has changed rapidly over the last year, and is expected to gain further momentum in the short to medium term. We believe that the future of the Omani real estate market looks bright underpinned by strong macroeconomic conditions, high liquidity, favourable demographics, and a proactive government which encourages private & foreign participation in the sector.