The government-owned Development Bank of Japan said Monday it has teamed up with Hoshino Resorts Inc. and Japan’s three largest commercial banks to launch a fund to help turn around struggling hotel operators.
The ¥14.14 billion fund will pay for renovations at hotels in regions doing poorly but deemed to have the potential to turn around due to their location or other factors, with the resort operator taking part in their operations.
The three banks are the Bank of Tokyo-Mitsubishi UFJ, Mizuho Bank and Sumitomo Mitsui Banking Corp.
The fund, set to operate for 10 years, will also help launch new hotels.
Following a fall in visitor numbers in 2011, Japan has seen foreign tourist arrivals grow by millions each year. But many hotels and Japanese-style inns in the countryside have been unable to capitalize on the growth due to competition from large chains and a lack of expertise on how to cater to foreign guests.
Hoshino Resorts, an operator of luxury Japanese-style inns founded in Nagano Prefecture, has been actively turning around struggling hotels and inns with potential.
A similar fund was set up by Hoshino Resorts and the DBJ in 2015. But without the commercial banks it was much smaller, at ¥2 billion.