Oman’s most ambitious development yet, the 64-hectare Mina Al Sultan Qaboos Waterfront, is not waiting for potential partners to come on board before launching the first phase. Its secure enough in the knowledge that they will … and soon enough.
At stake is 49 per cent in the operating company set up develop the first phase — “We want to make sure any partner coming in brings with them the track record and the international network to add true value,” said Salah Salim Al Ghazali, Chief Investment Officer at Omran, the Government owned master-developer. “It’s not about the cash to develop — banks are more than happy to participate in the project and that’s because of the location.
“On our own, we will have enough cash via asset sales to individual investors to support infrastructure development for the first phase — that’s why we can take our time finding a partner or partners.” (Omran — Oman Tourism Development Co — will hold 51 per cent. The first phase — there will be four overall — is to be completed by 2020.) In terms of scale and high-profile, the Waterfront does set a high marker for Oman’s real estate and touristic aspirations. At full development — over a 10- to 15-year time frame — it will transform Muscat’s old port area in Muttrah and create a “downtown hub”. (UK’s famed Foster and Partners is the architectural consultant.) “We decided to have the formal launch as soon as we received the title deed in the third quarter,” said Al Ghazali. “There will be some components in the first phase that will be done by third-party investors. There’s a lot of interest from private investors for these assets, which are available on 50-year leases and renewable for another 50.”
Additional phases
On why Omran was looking for equity partners in the operating company set up exclusively for the first-phase, the official said: “This way we are creating more value for the subsequent three phases and that works to the advantage of the investor who is coming into the first phase as well. We could have different partners for the additional phases.
“I don’t see a situation where we deal with 20 investors sharing the 49 per cent equity … more likely two or three. Two would be a good number.”
On when a new partner or more could be sighted, Al Ghazali said: “This is a deal worth hundreds of millions … these can’t be closed in weeks or month or two. Hopefully, in the first quarter of 2017, we will be able to confirm an investor. There is no plan, however, for an initial public offering at this stage.
“We will take up the residential component at the appropriate time — that could be in 2018. But if market demand is there, we could even bring that forward — why not?
“As for the master plan, we are in the process of detailed designs. But there are provisions to add a hotel or two — we can certainly make those slight manoeuvres based on demand. These are dictated by demand and supply.”
As things stand now, the Waterfront will include business and residential zones, a destination mall, six hotels and docking facilities for cruise liners and yachts. The terminal will enable direct travel to Iran via a ferry service.
Factbox: A destination that melds Oman’s past and the future
* Phase one of the mixed-use waterfront destination is to be completed by 2020, and transform the current commercial Port Sultan Qaboos area into a tourism and lifestyle attraction spanning 64 hectares.
* One element will be the Souq Al Mina, which will be a base for more than 80 local small businesses and F&B offerings. The retail enclave — scheduled for completion in the second quarter of 2017 — will be situated alongside a still functioning harbour for cruise ships and yachts.
* The Al Inshirah ferry terminal will allow direct travel to Iran. It will include 100-key five-star hotel as well as 50 luxury penthouses and the Royal Oman Police Coast Guard Tower.
By Manoj Nair
