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Boozey Dubai Hotel Brand Considers Las Vegas and Saudi for Expansion

FIVE Hotels Financials IPO FIVE Palm Jumeirah

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Dubai’s party brand FIVE Hotels is ready to leave the nest, mulling over nighlife havens such as Miami, Las Vegas, and Saudi Arabia.

Dubai’s home-grown hotel group FIVE is looking at potentially expanding beyond the emirate into the world’s largest hospitality markets. This includes a potential resort in party haven Las Vegas and in the conservative Gulf kingdom Saudi Arabia.

“For us, the U.S. market is very interesting, Saudi is very interesting. London would be interesting, Miami, Las Vegas,” said FIVE Holding chairman Kabir Mulchandani in a recent Dubai radio interview. “There’s a very high probability we can achieve global success with FIVE.”

The chairman then further teased overseas expansion in an Instagram post that included Las Vegas and Saudi.

Right now, FIVE Holdings has three hotels: Its original FIVE Palm Jumeirah; FIVE JVC also in Dubai; and FIVE Zurich, which is a reflagged property it opened last year.

Food and Beverage Focus

When FIVE launched in Dubai in 2017, the brand quickly made a name for itself as a lively nightlife-driven product in the Middle East. While Dubai is often seen as the most modern of all Arab cities, FIVE still managed to push the boundaries and became known as a party spot with extravagant bars and clubs.

This remains the case: Food, beverage and “eatertainment” account for more of FIVE’s business than filling hotel rooms.

  • In the third quarter of this year, the group had revenues of $53.9 million.
  • 22% of those revenues came from food and beverage sales.
  • 25% came from “eatertainment,” meaning the group’s club and party venues.
  • 39% came from rooms.
  • Up to September 2023, F&B and “eatertainment” brought $63.7 million in revenue at the group’s flagship Palm Jumeirah resort.
  • The same resort had revenues of $41.7 million from its rooms department.

FIVE In Europe

The group has a fourth hotel in development, FIVE LUXE, also in Dubai, planned to open before the end of the year. FIVE assigned these properties a “fair value” of 7.16 billion dirhams (approximately $1.95 billion).

FIVE is also focused heavily on the European market, particularly Spain, after it acquired Ibiza’s Pacha Group for around $350 million this year. This deal gives FIVE the Pacha nightclub brand, the El Hotel in Ibiza, and the Destino hotel, which will reflag as FIVE Ibiza in 2025. FIVE will spend around $26.9 upgrading the Destino to make it FIVE-worthy, according to the group’s Q3 development prospectus.

Mulchandani explained in a recent podcast of his that he has always been fond of the Destino, well before FIVE was brought to Dubai’s Palm Jumeirah island.

“We always wanted that [Destino] to be FIVE,” he explained. “In fact, a lot of FIVE was inspired by Destino. So the Destino will change, that will be a pure FIVE,” he continues. “It won’t be FIVE Pacha, that doesn’t make sense. FIVE has a very strong independent name and identity and a promise to its customers. So there will be a FIVE Ibiza, a Pacha Hotel Ibiza, and the Pacha Club.”

FIVE Hotels CEO Aloki Batra confirmed Thursday that he has assumed the dual role of Pacha Group CEO. Batra is credited by FIVE as the “mastermind” behind many of its successful restaurant and bar launches.

Alcohol in Saudi

While a potential FIVE resort in Saudi could be dry, the brand up to this point has become very well known for its parties and free-flowing drinks.

An article last year in the Wall Street Journal cited planning documents and sources to report that a “tony beach resort” would be serving alcohol in Saudi Arabia.

At a conference in Dubai last year, Andrew McEvoy, former head of tourism at NEOM said on stage that “alcohol was not off the table” within the project. McEvoy stepped down from his role and left the country following the conference. Two weeks later, the local government said it would not legalize alcohol.

The Saudi Press Agency issued a statement surrounding McEvoy’s comments at the conference, stating that his comments do not reflect the plans or beliefs of the country.

Announcements of fellow party hotels, such as the Faena in Diriyah Gate and SLS in The Red Sea, have also sparked further speculation.

Skift has reached out to FIVE for comment.

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