TOKYO - Japanese real estate developers are increasing their investment in high-end traditional-style inns and hotels.
Large player Hulic is entering the hotel business, with plans to buy two prestigious Japanese-style inns - Suishoen in Hakone, Kanagawa Prefecture and Fufu in Atami, Shizuoka Prefecture - for about 4 billion yen (S$45 million) from accommodation operator Kato Pleasure Group by the end of this month.
Both inns, which are located in popular hot spring areas, have some 20 rooms, each about 60-sq.-meters. All rooms come with open-air baths filled with water flowing directly from the hot spring source. A night's stay, including dinner and breakfast, does not come cheap at more than 100,000 yen for two guests. However, the occupancy rate is reportedly above 80 per cent.
Hulic and Kato are also considering setting up an inn operating business by the end of the year to tap into Kato's customer service know-how.
Hulic plans to continue buying one or two 30-50 room inns a year for 2-3 billion yen each. It plans to buy 10 properties for up to 30 billion yen over the next five years.
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