Oman’s profile in recent years can only be described as low, particularly as far as investment property is concerned. Eclipsed by its brighter and more daring Emirate neighbours, particularly Dubai whose higher-than-high skyrises have occupied most of the Middle East property investment limelight in recent years, the Sultanate of Oman has all but escaped investor attention.

However, Oman, perched at the southeastern end of the Arabian Peninsula and bathed by the Persian Gulf, has plenty to offer. It also enjoys the additional advantage of having escaped the excesses of property development, prevalent in Dubai. Considered by residents and tourists to be the ‘real’ Arabia, Oman has taken the development of its property market slowly but surely.

Conscious that its oil supplies will not be on tap forever, Oman is keen to diversify its economy into other resources and property investment is one of them. Oman is currently working hard to attract investor attention, but is also keen to learn from the errors accompanying over-development in places like Dubai and Abu Dhabi. Unlike these Emirates where numerous mega-projects are currently underway, Oman is home to just a handful of complexes. These include The Wave, Muscat Hills Club and the Norman Foster-signatured Blue City, and with them, Oman is aiming at the select end of the property investment market.
“Oman’s property market is one of the youngest in the region,” comments James Gonzalez, Market Analyst at Obelisk Investment Property, “so it’s an emerging market, but targeted at the higher, luxury end”. James points out that this together with limited and controlled development is likely to ensure that Oman property investment remains exclusive.

Like many of its Arabian counterparts, Oman imposes restrictions on foreign property ownership and foreigners are currently only permitted to own property within certain designated complexes. In spite of this limitation, however, property ownership comes with two big advantages – residence permits are available for the owner and their immediate family, and Oman is one of the world’s tax-free havens meaning that residents pay no income or capital gains tax.

While Oman has not escaped the global credit crunch, the effects on the Sultanate have been felt far less than in many neighbouring countries. Omani banks are traditionally conservative when it comes to lending – a characteristic that has served them well in the current financial climate. And the controlled development on a small scale within a country considerably larger than its UAE, Bahrain and Qatar neighbours has meant that Oman has largely avoided the effects of the global property slowdown.

News submitted by Alison Kane, Obelisk International

Local expert property Titan Properties has recently published its first ‘Distressed Sales List’ highlighting the most keenly priced properties in the western Costa de la Luz, namely Huelva province.

According to Spanish Government figures, price per square metre in Huelva rose a healthy 7.1% between 2007 and 2008, whilst Málaga could only report a scanty 1.5% price rise. But whilst the global recession and devalued pound etch deeper into the property landscape, there are more and more vendors highly motivated to sell. Good news for buyers motivated to get a foothold on Spain’s least developed and most affordable southern Costa.

Andrew Benitz, Director of Titan Properties, observes, “Undoubtedly the heavily developed Costas are floundering the most in these turbulent times, but western Costa de la Luz is finally succumbing to the bargain bug. Thanks to our longevity in the local marketplace, gaining the respect of the resident population, we have amassed quite a list of keenly priced properties which should take the sting out of the poor exchange rate. Discounts of 30 to 40%, previously unheard of, are now achievable. How long this climate will last is anyone’s guess, but the green shoots of growth are surely around the corner. No one’s managed to knock Spain off the number one spot yet for a holiday home, so the advice is to act now.”

A ‘Distressed Sales List’ is something of a moving target. By definition there is an urgent need to sell so the properties rarely stay on the market long due to their vastly reduced price. The following properties were available at time of writing, but please contact Titan Properties directly for latest opportunities.

TH4032, Townhouse, Los Enebros, El Rompido, Costa de la Luz
Was 349,800 euros, now 299,000 euros – 50,800 euro reduction (almost 15%)
Spacious three bedroom two bathroom corner townhouse within just 100 metres of El Rompido’s stunning stretch of wide sandy beach. The bedrooms and balconies all offer sea views. The kitchen is fully fitted with the bonus of a separate utility room whilst the living area has an open fireplace. In addition to a very generous 200m² private garden, the townhouse also has access to a freeform communal swimming pool manicured grounds and a tennis court. Local shops, bars and restaurants – seafood being a speciality – are within a five minute stroll.

TH4035, Townhouse, Punta Coral, El Rompido, Costa de la Luz
Was 300,000 euros, now 240,000 euros – 60,000 euro reduction (20%)
Brand new townhouse within the gated development of Punta Coral. The property has access to a communal lake-style swimming pool, landscaped gardens, paddle tennis court and underground parking. There are three bedrooms upstairs with built-in wardrobes (the master is en suite) whilst two of them have sunny balconies. There is an additional family bathroom on this floor with an extra shower room downstairs. A fully fitted kitchen and living room with patio doors leading to the terrace with small private garden complete the picture.

V4017, Villa, Nuevo Portil, Costa de la Luz
Was 630,000 euros, now 475,000 euros – 155,000 euro reduction (almost 25%)
Luxuriously appointed four bedroom villa overlooking Nuevo Portil’s 18-hole golf course and within just five minutes’ walk of both the Clubhouse and golden sand beaches. The property is centrally heated, the master suite has a large private terrace whilst outdoor space includes an enclosed courtyard ideal for al-fresco dining and a 12m by 6m swimming pool. Sold as seen to include furniture.

Apartment, Las Marismas, Isla Canela, Costa de la Luz
Was 151,000 euros, now 99,000 euros – 52,000 euro reduction (almost 35%)
Golf-front one bedroom apartment which benefits from a fully fitted kitchen, double glazing, community satellite television, hot and cold air-conditioning and aluminium security shutter-blinds in the lounge and bedroom. Communal facilities include several swimming pools set in landscaped gardens plus padel tennis courts, underground parking and round-the-clock security – the beach is less than 15 minutes’ walk. Covering 1,760 hectares with 7km of wide sandy beach, Isla Canela has an 18-hole golf course with challenging drives across the meandering streams, a 231-berth marina expected to extend to 800, restaurants, bars, shops and every conceivable outdoor sporting activity from football to bowling. The town of Ayamonte on the Portuguese / Spanish border is just 4km away.

News submitted by Sarah Drane, Titan Properties

For those looking for finance, particularly large-scale and/or for commercial property investment purposes, private equity funds offer an alternative means of obtaining capital.

One of the many casualties of the subprime crisis has been the brake on bank lending. In most countries globally, banks and highstreet lenders are now very reluctant to release funds to borrowers. While just a short time ago, lenders were almost queuing up to offer clients mortgages and personal loans, private individuals and corporate entities are now finding it increasingly difficult to obtain finance for even small investment projects.

For the individual investor, private equity funds may not be familiar, but they made their first main appearance on the world financial stage in 1946 when Georges Doriot, widely considered to be ‘the father of venture capitalism’, founded the American Research and Development Corporation (ARDC). Since then, private equity funds have established themselves as a main source of funding throughout the world. According to the European Private Equity and Venture Capital Association, private equity and venture capital funds have invested €270 billion in over 56,000 companies in Europe since 2000.

Private equity funds are established when a group of investors form a fund, which is then invested in a portfolio, often including property (commercial rather than residential). Investors come from a variety of backgrounds and typically include public pension funds, corporate pension funds, high net worth individuals, family offices and insurance companies. The investment period for the private equity fund generally lasts for a fixed period of 10 years, although many funds are extended for subsequent annual periods.

There are many benefits of using private equity funds as a means of financing a project or property development including access to long-term capital and an investment fixed within a framework of a negotiated contract. However, as Ken Thorkildsen, Director of Obelisk Private Finance, points out, perhaps the greatest advantage is that private equity allows the risks and profits to be shared between the fund and the borrower, something that is not an option with a loan from a bank or credit institution.

“An additional plus is also that the private equity fund may be able to assist with subsequent financing operations,” says Ken. “This is an important consideration for an entrepreneur or company with expansion plans for the future.”

News submitted by Alison Kane, Obelisk Private Finance

Property guru and billionaire, Sam Zell, continues to vouch for Brazil as one of the world’s hottest investment spots.

Property guru and billionaire, Sam Zell, continues to vouch for Brazil as one of the world’s hottest investment spots. Speaking at the Real Estate in Emerging Markets Forum held in New York last week, Zell even went as far as to state that “if you look at all the facts, I don’t think there is a better environment in all the world than Brazil.”

Zell, chairman of Equity International which has major investment interests in Brazil, has long been an advocate of Latin America’s largest country, claiming earlier this year that if he could, he’d “buy Brazil”. And looking at Brazil’s recent economic record, it is not difficult to see why.

Figures for Q3 GDP growth released on 9th December show that Brazil grew by an impressive 6.3%. This is even higher than Q1 and Q2 this year when growth registered 5.8% and 6% respectively. What makes these figures particularly remarkable is that they arrive at a time when many countries have seen yet further doom and gloom on the GDP growth front.

At a time when the global economic slowdown has left few countries untouched, Brazil is one of the few nations to be setting the standards for economic growth. The good news for Brazil is that this trend looks set to continue.

Not only is Brazil a major world provider of commodities such as iron ore and soya, but the recent discovery and development of Brazilian oil fields will eventually allow the country to become self-sufficient in oil as well as provide huge wealth. Many have dubbed Brazil’s President, “Sheikh Lula”, a title backed by the recent Chinese decision to lend the state-owned energy company, Petrobas, $10 million to develop the massive oil fields off the coast of Rio de Janeiro.

In the midst of the economic slowdown – and no visible sign of this changing significantly during 2009 – Brazil represents a refreshing change and offers exceptional investment opportunities. Property investors would do well to follow in Zell’s footsteps and “buy Brazil”.

News submitted by Alison Kane, Obelisk International