Oman hotels see record revenue growth as occupancy and travel rise

Oman’s hotel revenues jump 18%, driven by strong travel demand and rising occupancy

Last updated:
Nivetha Dayanand, Assistant Business Editor
3 MIN READ
Travel boom lifts Oman hotel revenues to record levels in 2025.
Travel boom lifts Oman hotel revenues to record levels in 2025.
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Dubai: Oman’s hospitality sector maintained strong momentum through the first nine months of 2025, as robust domestic and international travel lifted hotel occupancy, guest volumes, and total revenues. According to new research by Cavendish Maxwell, hotel revenues rose more than 18% year-on-year to reach OMR193.4 million ($505 million) by the end of September, marking the strongest nine-month performance on record.

Room revenues alone grew by nearly 21%, while hotel employment increased by 5.3%, reflecting higher service requirements to meet expanding demand. Occupancy levels averaged 52.8%, up by 13% from the same period in 2024, showing that hotels are effectively absorbing new supply and extending performance beyond traditional peak seasons.

Oman’s hospitality industry performed strongly to the end of Q3 2025, with robust demand from domestic and international travellers,” said Khalil Al Zadjali, Head of Oman at Cavendish Maxwell. “Government investment, population growth, targeted marketing initiatives and evolving travel patterns are all playing key roles in the success of the sector, which is set to enjoy further growth, resilience and diversity in 2026 and beyond.”

Airports attract growing traffic as Muscat leads

Oman’s airports handled 11.2 million passengers between January and September 2025, a modest increase of 0.7% from the previous year, according to Civil Aviation Authority data. Despite limited operations at Suhar International Airport, total passenger volumes are expected to reach 14.6–14.9 million by year-end, up from 14.5 million in 2024.

Muscat International Airport continued to dominate traffic, serving 9.8 million passengers or nearly 87% of the total. Salalah International Airport ranked second with 1.4 million passengers, of which more than a fifth arrived during the Khareef season, a key travel period that boosted both air traffic and hotel demand in the southern Dhofar Governorate.

Domestic travellers remain key to hotel performance

Guest arrivals at 3–5 star hotels reached 1.7 million during the first nine months of 2025, a 9% increase compared with the same period last year. Omani nationals accounted for 38% of total guests, underlining the strength of domestic tourism. European visitors ranked second at 24.7%, followed by travellers from Asia (14.4%) and the GCC (9.9%). Other Arab nationals contributed 4.5%, while guests from the Americas, Oceania, and Africa made up the rest.

Government initiatives such as the #WithinOman campaign and the Experience Our Winter programme have helped raise travel volumes across both local and target foreign markets. These campaigns have supported a more balanced visitor base and helped smooth seasonal fluctuations in demand.

Room rates steady as hotels prioritise occupancy

The average room rate (ARR) across 3–5 star hotels stood at OMR45.3 ($117) for the nine-month period, just 1.3% higher than a year earlier. The stability shows that hotel operators are focused on maximising occupancy and optimising room inventory rather than driving growth through steep rate increases.

Rates were strongest in April, followed by February and August, reflecting tourism peaks around public holidays and the Khareef season in the south.

Expanding hotel supply supports long-term growth

Oman’s hotel room inventory stood at 36,300 rooms at the end of the third quarter, with about 1,000 additional rooms scheduled to be completed before year-end. Another 3,000 rooms are expected to come onstream by 2027, raising the total to 40,300.

At the same time, the Ministry of Heritage and Tourism advanced sector development by signing 36 usufruct agreements worth OMR100 million ($260 million). These projects include hotels, resorts and integrated tourism complexes spread across multiple governorates, helping to diversify the accommodation landscape.

Balanced growth outlook for 2026

Analysts expect the sector’s outlook to remain solid, with hotel performance supported by steady international arrivals, stronger domestic tourism, and continued infrastructure investment. The market’s ability to efficiently absorb new capacity suggests a stable, sustainable growth path.

Oman’s hospitality industry is entering a new phase characterised by steady expansion and deeper market diversity. The combination of government initiatives, private investment, and growing regional connectivity positions the Sultanate to sustain its year-round appeal and build on the gains achieved through 2025.

Nivetha Dayanand
Nivetha DayanandAssistant Business Editor
Nivetha Dayanand is Assistant Business Editor at Gulf News, where she spends her days unpacking money, markets, aviation, and the big shifts shaping life in the Gulf. Before returning to Gulf News, she launched Finance Middle East, complete with a podcast and video series. Her reporting has taken her from breaking spot news to long-form features and high-profile interviews. Nivetha has interviewed Prince Khaled bin Alwaleed Al Saud, Indian ministers Hardeep Singh Puri and N. Chandrababu Naidu, IMF’s Jihad Azour, and a long list of CEOs, regulators, and founders who are reshaping the region’s economy. An Erasmus Mundus journalism alum, Nivetha has shared classrooms and newsrooms with journalists from more than 40 countries, which probably explains her weakness for data, context, and a good follow-up question. When she is away from her keyboard (AFK), you are most likely to find her at the gym with an Eminem playlist, bingeing One Piece, or exploring games on her PS5.
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