Business / Corporate

Olympics spur hotel development rush in Japan

Kyodo

With Japan in the grip of a tourism boom in the run-up to the 2020 Summer Olympics, many domestic and foreign hotel operators are capitalizing on the growing demand for accommodations.

Marriott International Inc.’s top-end Edition brand will debut in Japan with two luxury hotels opening in Tokyo’s Toranomon and Ginza areas in 2020. The Maryland-based company is entering the market in partnership with real estate developer Mori Trust Co.

“Japan has an extremely short supply of luxury hotels,” said Miwako Date, president of Mori Trust.

The new openings are not limited to Tokyo. Her company plans to open 10 first-class hotels Japan by 2023, including the two Marriots and another in the capital.

InterContinental Hotels Group PLC, a British operator of luxury hotels, will open a spa resort in Beppu, Oita Prefecture, in 2019 with leasing company Tokyo Century Corp. The city, a well-known hot spring resort, is one of Kyushu’s top tourism draws.

Ooedo-Onsen-Monogatari Co., which runs a hot spring entertainment chain, acquired a long-established hotel in the city and reopened it in July after refurbishment. Hoshino Resort Co. followed suit at another well-established hotel.

Prince Hotels Inc., meanwhile, plans to open 100 inns under a new budget brand in many areas of Japan.

“We hope to meet diversifying accommodation needs,” Takashi Goto, president of Prince Hotel’s parent Seibu Holdings Inc., said.

The government wants to bring 40 million tourists to Japan in 2020 and 60 million in 2030. But its early success has already highlighted the nationwide accommodations shortage.

Some analysts warn of impending manpower constraints. To make up for the shortage, the government has been promoting the use of minpaku (home lodging services).

A law that took effect in June lets people rent private homes to tourists.

While Airbnb Inc. of the United States leads the business in Japan, electronic commerce platform operator Rakuten Inc. has announced a plan to enter the market as well.

Reports have emerged, however, of trouble emerging between lodgers and surrounding residents over such issues as noise and garbage.

Railway operator Keio Corp. opened an apartment solely for minpaku in Tokyo in February.