Arequipa is notable as one of the few cities outside of Lima in Peru to have openly gay businesses—two dance clubs and a video store—along with a few gay-owned and gay-friendly hotels.  The city population, one million, does guarantee the existence of a sizable gay community. That, and the exceptional level of culture: theatre groups, art associations, and such, where there is at least a minimal level of tolerance.  
Gary Lee, who with his Peruvian partner manages the Casa Arequipa, an upscale Bed and Breakfast, says that the more openly gay businesses provide an opportunity for individuals to get in what is still a low-profile community, which is very welcoming to outsiders, for whom they will gladly host private social events.
Lee adds that while there is "still a lot of anti-gay prejudice," and that the lesbian community is much more closeted than the gay male community, Peru is nonetheless "an evolving, changing culture."
The two gay dance clubs are SKP at 205 Villalba, and Open Night, at the corner of Salaverry and Jorge Chavez.  Both clubs open late and stay open late.