Dubai hotel developer pins success on green credentials

Five Jumeirah Village Dubai

• Five Holdings reports 9% revenue rise
• Kabir Mulchandani cites green standards
• IPO planned for first half of 2025

As protests against mass tourism sweep across Europe, the head of a Dubai-based developer with business in Ibiza said he is confident his company’s sustainability credentials can address such concerns.

Kabir Mulchandani, founder and chairman of Five Holdings, believes that mounting apprehension around increasing visitor flows to the world’s most sought-after destinations is rooted in the impact on the environment.

“I think our sustainability across all our assets is helpful if that does become a material threat to the industry,” Mulchandani said during a first-quarter earnings call, adding that he has not seen any impact from the protests on his business at this time. 

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Five is the only company in the world to receive an ‘A’ ESG rating across all sectors from the Institutional Shareholder Services group of companies, Mulchandani said. Its ongoing refurbishing of the Destino hotel in Ibiza aims to meet the highest global net-zero standards.  

The company owns three high-end hotels in the UAE and one in Switzerland. It bought the Destino property, as well as the renowned Pacha nightclub and El Hotel Pacha, as part of its acquisition of Ibiza’s Universo Pacha last year.

Mulchandani said on the call that Five Holdings has three investment banks, as well as lawyers and internal and external auditors, already lined up for an expected initial public offering on either the Dubai or London stock exchange, or both. 

The technical and legal framework for the IPO should be ready by the end of the year, although the listing itself is slated for the second quarter of 2025, he said. 

News reports last week named Citi and Deutsche Bank as Five’s advisers. 

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In the first three months of this year, the company reported a 9 percent increase in revenue – AED 261 million compared with AED 239 million in the first quarter of 2023 – for its hospitality business amid high occupancy rates at its key hotels.  

Its real estate development business declined from AED 168 million in the first quarter of 2023 to AED 95 million in the three months to March. 

Mulchandani said on the call that the drop was expected after Five Holdings completed the development of its latest luxury addition in Dubai, Five Luxe Hotel and Residences, last year.

“We develop real estate specifically for our hospitality projects,” he noted. “We are not a typical developer that keeps churning out real estate properties. We don’t have a land bank.”