Colliers Trend Report
Burgeoning of Quality Serviced Apartments
Up until Q4 2015, Muscat had relatively poor quality serviced apartment supply. The market gap for quality serviced apartments is finally being addressed, as last year the Millennium Executive Apartments opened its doors, making it the first internationally branded serviced apartment in Muscat. The reception for this product has been very positive, as GCC families and extended-stay business individuals — both inbound and domestic travellers — finally found the level of service they were looking for in Muscat. Additional serviced apartment supply is expected to enter the market in 2016, including the 277-key Somerset Panorama, the 88-key Coral Muscat Hotel Apartments, and the 77-Key Kempinski Residences the Wave.
Development of Mall Hotels in full swing
Another hospitality market gap which is currently being addressed is that of hotels and serviced apartments with direct connectivity to malls — and which typically prove to be very popular with the corporate clientele and the GCC leisure market. One example is the 296-key Grand Millennium Muscat, which will be directly attached to the Muscat Grand Mall in Khuwair South, and which is expected to open in 2016. Another example of is the 250-key Dusit D2 hotel & apartments in South Batinah, which will be attached to Palm Mall and is expected to open in 2017.
Source markets
Colliers International director and head of hotels MENA Filippo Sona says Oman hotels’ traditional top source markets are domestic, GCC, and European tourists. “The largest increases are from India and Pakistan due to the strong marketing activities by the Ministry of Tourism, and the ease of access from the subcontinent. The increase is also due to the fact that neighbouring countries have a large Asian population which stay for 2-3 nights.”
He adds: “Europeans are expected to represent the majority of demand to the cultural resorts in Nizwa and mountain resorts in Jebel Akhdar, and hoteliers will heavily rely on their longer length of stays to sustain healthy KPIs throughout the year.”
City Seasons Muscat GM Christian Palacin says a rising trend in Oman is the influx of tourists from Central Europe as well as the GCC: “European tourists are now discovering Oman, and their choice is highly influenced by the instability in the other Arab countries where they used to vacation, namely Egypt, North Africa, Jordan, Syria et cetera.”
Palacin has also seen an increase in the India and South Asia inbound as well as the Iranian leisure market. “This pull is mainly due to the proximity of the source countries and also for the increase in airlines routes to Muscat as well as the competitive prices offered by the different airlines serving the area,” he explains.
Al Bustan Palace, a Ritz-Carlton Hotel GM Katrin Herz says her property, which turned 30 years old in 2015, is seeing great interest from German markets and European countries.
Six Senses Zighy Bay DOSM Jad Frem predicts that the new source market will emerge. “China, for example, so this is something that Omani hoteliers are making extra efforts towards.”
Orascom Hotel Group managing partner Abdelhamid Abouyuoussef says OHM started relying on regional business, then diversified to Germany, Italy, Poland and Sweden. “In the coming years, we will be setting base for Oman in Russia, France, Slovakia, the Czech Republic, and also Japan and China,” he adds.
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