Trinity Investments LLC, a Hawaii-based real estate firm, said it plans to open a chain of limited-service hotels in Japan in partnership with Hotel Okura Co., targeting a surge in tourism that the government hopes will double by 2020 when Tokyo hosts the Olympic Games.
Trinity will seek to raise as much as $300 million in equity to initially fund the chain, called Nikko Style and aimed at leisure and business travelers, said Sean Hehir, president and chief executive officer of Trinity. The first hotel is scheduled to open in 2020, he said. The partners aim to open 20 to 30 Nikko Style hotels throughout Japan, including in Tokyo, Osaka and Fukuoka, then potentially expand in Asia, North America and Europe, Hehir said.
"When we looked at the current hotel offerings, there were a lot at the budget end and also at the full-service end," Hehir said. "There wasn't as much activity in the select-service space we're targeting."
Trinity faces competition from the major U.S. chains expanding in Japan. Select-service hotels are the fastest-growing segment of the U.S. lodging industry, costing less to develop and operate because they typically don't have restaurants or meeting space and require fewer employees. Most Nikko Style hotels will have a breakfast restaurant and limited meeting space.
"There's still a very wide-open market for select-service in Japan," Hehir said.