Oman awards $600m contracts for tourism projects

• Three four-star hotels planned
• Adventure park at Wadi Shab
• Mixed-use developments grow

Oman has awarded contracts worth more than $600 million to build three tourist resorts and an adventure park as it steps up efforts to compete with its Gulf neighbours for hospitality revenue and create jobs for its citizens.

“This is another important milestone to attract more tourists in the country and property investors as part of our economic vision for the year 2040,” Salim bin Mohammed Al Mahrouqi, minister of heritage and tourism, told Oman Television.

The first award from the ministry of heritage and tourism is on the Musandam peninsula, in the Strait of Homuz gap between the Arabian Gulf and the Gulf of Oman. It includes a 200-room hotel and 450 properties on the beach front that will be offered to both local and international investors. 

The second project, named Ibri View, is in the town of Ibri about 250km inland from Muscat and includes a 250-room hotel and 300 properties for sale.

The third is a 156-room hotel and more than 500 properties for sale near Nakhal, about 90km inland from Muscat.

The fourth is an adventure park with a camping site of Wadi Shab, about 45km southeast of Muscat.

“We need more tourists but we also need more cash-loaded investors to buy properties and live here,” said Saud Al-Hashmi, managing director of Muscat-based Capital Investments.

Alamy via Reuters

The Omani hospitality sector experienced some growth in 2024, according to a report published this month by Dubai-based property consultants Cavendish Maxwell.

Mid- to-upscale hotels, those rated between three or four stars, registered a near 4 percent rise in guest arrivals and a 6 percent increase in revenue, Cavendish Maxwell said. 

This points to “a steady recovery in demand without significant upward pressure on pricing,” according to the real estate consultancy.

Oman’s overall tourism performance, nevertheless, pales in comparison to that of neighbouring Gulf states. That is partially a result of its pursuit of slower, heritage- and nature-focused visitors over mass arrivals, analysts told AGBI earlier this year.

In 2024, total visitors to Oman actually fell by nearly 3 percent to 3.9 million, according to government data, while they rose 9 percent in Dubai and Saudi Arabia and 25 percent in Qatar.

Besides the four new contracts, other major mixed-use developments with a focus on hospitality are in the pipeline across the country. 

This month, the Lux Collective launched a hotel and branded residences destined for the $2.6 billion Sultan Haitham City, which is under construction northwest of Muscat.

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Trump-branded villas are being built in the Aida gated community and a golf course is planned along the hills overlooking Muscat.

According to Cavendish Maxwell Oman has 270 hotels with a combined 24,000 rooms. About 5,800 more rooms are forecast to be available by 2030 across 35 new projects, especially in high-end and luxury segments.

“Half of the population of expatriates in Oman are either manual workers or in domestic employment,” said Capital Investments’ Al-Hashmi.

“These projects will bring wealthy foreign nationals in the country to boost cash circulation in the market.”