Searchfolder created from EWS is not displaying items falling under criteria within Outlook

I have been working on different SearchFolders cases lately where customers were trying to create SearchFolder using EWS. Working on those issues has uncovered a limitation of Outlook (I tested it on 2007, but may exist with earlier versions as well)

I created the search folder using the following XML

 <?xml version="1.0"?>
<CreateFolderType xmlns:xsi="" xmlns:xsd="">
  <ParentFolderId xmlns="">
    <DistinguishedFolderId Id="searchfolders" xmlns="" />
  <Folders xmlns="">
    <SearchFolder xmlns="">
      <DisplayName>Employee Search</DisplayName>
      <SearchParameters Traversal="Deep">
              <ExtendedFieldURI DistinguishedPropertySetId="PublicStrings" PropertyName="EmployeeID" PropertyType="String" />
                <Constant Value="" />
              <ExtendedFieldURI DistinguishedPropertySetId="PublicStrings" PropertyName="CustomPropertyName" PropertyType="String" />
          <DistinguishedFolderId Id="inbox" />

I have created an email with custom property and it has some value in there to meet the criteria. The search folder is created and visible in the Outlook but I still do not see any entries under that folder. I also tried with just "Exists" criteria for the custom property but still it does not list the item. Then I created another SearchFolder with specific words in subject and itemClass = IPM.NOTE and that works fine… surprised!!

I went ahead and tried to test the Search Folder from OWA, to further add to my surprise it was not even listed in OWA… strange!! So then I dig into and found the following KB -

Symptoms: When you create Search Folders in Microsoft Office Outlook 2007 and Microsoft Office Outlook 2003in a Microsoft Exchange profile, the Search Folders do not appear in Microsoft Outlook Web Access.

Cause: This behavior occurs when you use Outlook in Cached Exchange Mode. The local copy of your mailbox maintains a Finder folder. This folder is not synchronized with the Finder folder that is in your Microsoft Exchange mailbox.

Resolution: Switch to online mode, expand search folders, let it sync with server and then you should be able to see.

I followed the resolution steps and now I can see the items in OWA & also in Outlook… relief!!

Happy Debugging…