Breather for tenants as some real estate companies in Oman reduce rents

Muscat: A few real estate companies in Oman are offering exemption in rent to the tenants financially impacted by the COVID-19 pandemic. The measure was announced to provide relief to those who could not afford to pay their rent due to their salaries or jobs being negatively affected by the pandemic. Measures regarding the reduction of rent from commercial properties have also been rolled out.
Fahad Al Ismaili, executive director of Tibiaan Real Estate, said that they would exempt residents from paying rent "from April until the precautionary measures are lifted. We have divided our tenants into two categories -- residential and commercial -- to study the impact of the pandemic on them.
"When it came for our residential portion of tenants, we separated them into two categories. The first consists of unaffected tenants, for whom the rent payments remain unchanged, as their monthly salaries have not been affected. The second category comprises those whose salaries were reduced, or were laid off from their work. We granted them facilities to exempt them from paying the rents in full after receiving proof of the same from their employer,” he said.
Approximately 3 per cent of their 1,400 tenants are in line to receive this benefit. Commercial properties have been affected in larger numbers, with about 80 per cent of Tibiaan’s tenants seeking assistance. For their commercial properties, Tibiaan Real Estate conducted a similar study. The company has also permitted residential or commercial tenants affected by the crisis to break their contracts without imposing any additional fees.
Al Ismaili said, "Income for commercial activities such as restaurants and cafes has been affected by about 50 per cent, as they get their daily income through home delivery or from the store. Here, we have reduced the percentage of rents for such businesses to 50 per cent. The last section of our list features activities that have been completely shut for now, such as barbers, tailors and laundry shops. They are exempted from paying 100 per cent of their rent."
Various other real estate owners have come forward with similar gestures. Bakhit Al Badi, who owns villas in the Wilayat of Saham in North Al Batinah, said: "I have postponed the rent due from villas because I really know that all the tenants have been affected by the COVID-19.”
Abu Omar, a real estate investor who has a number of buildings in Ruwi and Al Khuwair in Muscat Governorate, also confirmed that he had reduced the rents for tenants to 50 per cent of what was due, and those who could not pay the rent could pay them after July this year.
The Omani Chamber of Commerce and Industry had previously proposed ways to tide over the problems that people in the Sultanate are currently experiencing when it comes to paying rent, such as the exemption, reduction, and postponement of amounts due from tenants.
Hassan Al Ruqaishi, chairman of the Real Estate Development and Construction Committee at the Omani Chamber of Commerce and Industry, spoke exclusively to Times of Oman on this subject.
He said: “Since the beginning of the coronavirus pandemic in the Sultanate, we have been the first to research and appeal to real estate institutions to take into account the situation of those affected by the pandemic. This is especially true in the case of owners of commercial activities, most of which are closed. Some of them have no income to cover rents, and employees whose salaries have been reduced also cannot pay rents for their apartments."
Al Ruqaishi added: "The chamber is considered to be the home of businessmen who own commercial activities, and therefore, it has taken into account their financial circumstances."
He said the matter had been discussed in recent meetings of the chamber and that real estate owners had responded positively to the organisation’s request to lighten the economic burden of tenants.
Redha Jumaa, member of the board of directors and head of the health sector committee at the OCCI said: "The Sultanate is going through a double economic crisis due to the coronavirus pandemic on the one hand and the low oil prices in global markets on the other. Commercial companies are directly or indirectly affected by the precautionary measures taken to stop the spread of the coronavirus, especially as small companies constitute 85 per cent of these commercial activities.”
Redha gave the example of her brother, stating that he had reduced rents on his properties by 50 per cent for a period of three months, March, April, and May. He has also reportedly postponed rent payment of tenants by half. She appealed to real estate owners to consider their religious, humanitarian, and moral duties towards supporting tenants during this difficult time.