There's officially a new lifestyle hotel member of the Hilton Honors family, and it's all about the collegiate life — well, without the stress of midterms and awkward roommates.
04.09.2024 - 00:11 / skift.com / Josh Corder
Local Dubai hotel group FIVE reported financial results Monday that show the company has continued to benefit from the emirate’s robust tourism sector, but also that it will need to look elsewhere for growth.
FIVE chairman Kabir Mulchandani pointed to lower room revenues at the flagship FIVE Palm Jumeirah, and attributed to the dip to “cannibalization” – it now has three hotels in Dubai.
“There have been some challenges we’re facing at FIVE Palm Jumeirah,” Mulchandani said, adding: “It’s primarily driven by a form of potential cannibalization. When FIVE LUXE opened, we have two hotels on the beach.”
Room revenues at FIVE Palm Jumeirah fell 8.9%. FIVE LUXE is located less than 20 minutes away from FIVE Palm Jumeirah.
FIVE Holdings has four hotels: Its original FIVE Palm Jumeirah; FIVE JVC, and the recently-opened FIVE LUXE also in Dubai; and FIVE Zurich, which is a reflagged property. The group also has a private jet that its chairman uses and charters to guests in a venture called FLY FIVE.
In a Dubai radio interview last December, Mulchandani said FIVE was focused on expanding overseas and out of Dubai. “For us, the U.S. market is very interesting, Saudi is very interesting. London would be interesting, Miami, Las Vegas.”
In a call Monday discussing results, Mulchandani emphasized the potential of U.S. expansion. “The goal was always… Our brands would do exceptionally well in the U.S. We won’t overstress ourselves right now. The U.S. would be a priority over Saudi Arabia for now, given that Saudi needs to open up a bit more for our kind of product.”
FIVE also is focused heavily on the European market, particularly Spain, after it acquired Ibiza’s Pacha Group. 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.
Speaking about FIVE’s only non-Dubai hotel, located in Switzerland, Mulchandani said FIVE Zurich is doing well, but he wouldn’t turn down a chance to sell it.
He said: “We’ve been debating internally [selling FIVE Zurich]. For now, while it is generating positive EBITA, we’re not actively looking to dispose of it. But if we received an offer we can’t refuse, we would take it.”
In the second quarter, FIVE reported a gross profit of 196 million Dirhams ($53.3 million), up 5.3% from 186 million Dirhams ($50.6 million) at the same point last year.
Here are some of the key figures in the quarter:
FIVE’s surge in revenue can be attributed to the opening of its fourth hotel, FIVE LUXE in March.
What am I looking at? The performance of hotels and short-term rental sector stocks within the ST200. The index includes companies publicly traded
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