MUSCAT // At the peak of the regional property boom in 2008, the developer Sama Dubai built an elaborate sales office for its Salam Yiti project in a vibrant area of downtown Muscat.
It was a new phenomenon for the usually staid Omanis: spending millions of rials on what was ultimately a marketing effort.
The centre, which featured ornate fountains, large models of the resort and replicas of rooms in the villas, was meant to last only as long as a quick sales push.
It was built without foundations and the land was leased for only five years.
Just 18 months later, a red and white plastic tape blocks access to the building, the heavy wooden doors are locked and the fountains are dry. Salam Yiti is on hold.
All of the property economies across the Gulf took a hit from late 2008 as the financial crisis spread around the world, but none fell as hard over the past 18 months as Dubai.
There were, however, other casualties -projects in neighbouring countries launched on the Dubai model of large marketing budgets, financing from pre-sales and the idea that bigger is better.
"I always thought if there is one thing that Oman shouldn't do it is imitate Dubai," said Eihab al Saleh, the chief operating officer of the OHI group and a member of one of Muscat's leading families.
"Things are different here. We have so much land. It's beautiful. We didn't need these things."
Property prices in Muscat have fallen by between 30 and 40 per cent since the downturn started, but as sales begin to pick up again, thanks in large part to a proactive visa policy from the government, local developers are beginning to define what they believe should be the Omani model.
Michael Lenarduzzi, the chief executive of The Wave project, said his company had shifted away from big, high-profile launches to smaller sales efforts that cater to the different communities in Muscat: expatriates who have lived in Oman for decades; young families looking for their first home; and locals who are looking for long-term investments.
Foreigners looking for second homes and those looking for speculative investments that they could re-sell in a short period for profits are no longer on the agenda, Mr Lenarduzzi said.
The result is that a recent offering of 168 apartments and townhouses last month has so far sold more than 80 per cent.
"When I first came, there was a lot of that Dubai thinking going on and now that's changed," Mr Lenarduzzi said.
"After the slowdown, we basically went back and did a lot of research and we realised it wasn't just about big launches. It was about investing in communities; building the golf course and marina we promised."
The Oman model, he said, was to look for "steady-state, long-term sustainability". This is all the more important because Oman's oil supplies will only last another few decades and the country's priority is to become a leading tourist destination, as well as building up other industries such as manufacturing and logistics.
The stalling of projects like Salam Yiti and Blue City, a proposed US$22 billion (Dh80.79bn) master-planned city 45 minutes west of Muscat that could be liquidated under plans being discussed by the developer, are weighing heavily on these efforts, but they are also pushing the Oman government to reconsider what will bring tourists to the country.
"The fact that some of these projects are having trouble selling doesn't affect us directly, but it does indirectly affect our strategy to build up the tourism sector," said Wael Lawati, the chief executive of the government-owned tourism developer Omran.
Analysts point out that to service its tourism agenda, the government has moved away from new hotel launches and large-scale resorts and is focusing on how to bring holidaymakers to the country.
Oman Air has increased its flights into the country and Muscat is hosting more events, such as the Asian Beach Games next December, to put itself on the global tourism map.
Matthew Wright, a development adviser at the property consultancy Cluttons in Oman, said the discussion across the board had shifted to "generation of demand".
"You actually need to know who is going to come and buy this stuff, where the demand is going to come from," Mr Wright said.
"The idea that if you build it, the demand will generate by itself is no longer true.
"What's happened in the last year and a half is the market has grown up quite quickly."
Demand would not be built through extravagant sales centres, he said. "It comes down to why people want to come to Oman for a holiday," Mr Wright said.
"It's about what is actually here, rather than what we say will be here."
bhope@thenational.ae
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
Traits of Chinese zodiac animals
Tiger:independent, successful, volatile
Rat:witty, creative, charming
Ox:diligent, perseverent, conservative
Rabbit:gracious, considerate, sensitive
Dragon:prosperous, brave, rash
Snake:calm, thoughtful, stubborn
Horse:faithful, energetic, carefree
Sheep:easy-going, peacemaker, curious
Monkey:family-orientated, clever, playful
Rooster:honest, confident, pompous
Dog:loyal, kind, perfectionist
Boar:loving, tolerant, indulgent
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
The White Lotus: Season three
Creator: Mike White
Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell
Rating: 4.5/5
ARM%20IPO%20DETAILS
%3Cp%3E%3Cstrong%3EShare%20price%3A%3C%2Fstrong%3E%20Undisclosed%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ETarget%20raise%3A%3C%2Fstrong%3E%20%248%20billion%20to%20%2410%20billion%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EProjected%20valuation%3A%3C%2Fstrong%3E%20%2460%20billion%20to%20%2470%20billion%20(Source%3A%20Bloomberg)%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ELead%20underwriters%3A%3C%2Fstrong%3E%20Barclays%2C%20Goldman%20Sachs%20Group%2C%20JPMorgan%20Chase%20and%20Mizuho%20Financial%20Group%3C%2Fp%3E%0A
The specs
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
Mica
Director: Ismael Ferroukhi
Stars: Zakaria Inan, Sabrina Ouazani
3 stars
How much do leading UAE’s UK curriculum schools charge for Year 6?
- Nord Anglia International School (Dubai) – Dh85,032
- Kings School Al Barsha (Dubai) – Dh71,905
- Brighton College Abu Dhabi - Dh68,560
- Jumeirah English Speaking School (Dubai) – Dh59,728
- Gems Wellington International School – Dubai Branch – Dh58,488
- The British School Al Khubairat (Abu Dhabi) - Dh54,170
- Dubai English Speaking School – Dh51,269
*Annual tuition fees covering the 2024/2025 academic year
Teams
Punjabi Legends Owners: Inzamam-ul-Haq and Intizar-ul-Haq; Key player: Misbah-ul-Haq
Pakhtoons Owners: Habib Khan and Tajuddin Khan; Key player: Shahid Afridi
Maratha Arabians Owners: Sohail Khan, Ali Tumbi, Parvez Khan; Key player: Virender Sehwag
Bangla Tigers Owners: Shirajuddin Alam, Yasin Choudhary, Neelesh Bhatnager, Anis and Rizwan Sajan; Key player: TBC
Colombo Lions Owners: Sri Lanka Cricket; Key player: TBC
Kerala Kings Owners: Hussain Adam Ali and Shafi Ul Mulk; Key player: Eoin Morgan
Venue Sharjah Cricket Stadium
Format 10 overs per side, matches last for 90 minutes
Timeline October 25: Around 120 players to be entered into a draft, to be held in Dubai; December 21: Matches start; December 24: Finals
You Were Never Really Here
Director: Lynne Ramsay
Starring: Joaquim Phoenix, Ekaterina Samsonov
Four stars
U19 WORLD CUP, WEST INDIES
UAE group fixtures (all in St Kitts)
Saturday 15 January: v Canada
Thursday 20 January: v England
Saturday 22 January: v Bangladesh
UAE squad
Alishan Sharafu (captain), Shival Bawa, Jash Giyanani, Sailles Jaishankar, Nilansh Keswani, Aayan Khan, Punya Mehra, Ali Naseer, Ronak Panoly, Dhruv Parashar, Vinayak Raghavan, Soorya Sathish, Aryansh Sharma, Adithya Shetty, Kai Smith
The specs
Engine: 3.9-litre twin-turbo V8
Transmission: seven-speed
Power: 620bhp
Torque: 760Nm
Price: Dh898,000
On sale: now
UAE currency: the story behind the money in your pockets
The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
MATCH INFO
Euro 2020 qualifier
Norway v Spain, Saturday, 10.45pm, UAE
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
The biog
Age: 30
Position: Senior lab superintendent at Emirates Global Aluminium
Education: Bachelor of science in chemical engineering, post graduate degree in light metal reduction technology
Favourite part of job: The challenge, because it is challenging
Favourite quote: “Be the change you wish to see in the world,” Gandi
At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
Results
1. Lewis Hamilton (Mercedes) 1hr 32mins 03.897sec
2. Max Verstappen (Red Bull-Honda) at 0.745s
3. Valtteri Bottas (Mercedes) 37.383s
4. Lando Norris (McLaren) 46.466s
5.Sergio Perez (Red Bull-Honda) 52.047s
6. Charles Leclerc (Ferrari) 59.090s
7. Daniel Ricciardo (McLaren) 1:06.004
8. Carlos Sainz Jr (Ferrari) 1:07.100
9. Yuki Tsunoda (AlphaTauri-Honda) 1:25.692
10. Lance Stroll (Aston Martin-Mercedes) 1:26.713,
