Return on investment is one of the important considerations when investing in real estate market. Yet with limited supply and compressed yields, opportunities of finding “good” assets generating decent return are small especially in Tokyo central locations.

In this issue, List Sotheby’s International Realty presents opportunities in Japan Hotel market and features two innovative companies specializing in alternative lodging – a concept breathing new life into the hospitality industry and share how they create and maximize value.

MARKET OPPORTUNITIES

Alternative lodging, are accommodations for groups of people to share the same facilities compared to traditional hotels limiting the number of guests per room. Created in part by the “Minpaku” law regulating the private lodging business (i.e. Airbnb), demand for “new style” accommodation offering experiences and personalized services have skyrocketed and are expected to increase in the future. List Sotheby’s International Realty is proud to introduce two exciting investment concepts – Alternative Lodging and Smart Hostels (IoT).

ALTERNATIVE LODGING – CONVERTING RESIDENTIAL BUILDINGS TO HIGH QUALITY HOTEL ACCOMMODATION

Inthehood Hospitality

IntheHood is a Tokyo-based operator of Minpaku, hotels, and furnished apartments founded by an experienced and creative team of people who are addressing the undersupply of Airbnb-esque products after the implementation of Minpaku Law. They now manage approx. 150 units, which are all highly rated on on-line booking sites featuring the following:

• speciality in converting residential buildings into fully serviced, high-quality accommodation
• stylish design with concierge services, maximizing value on investment
• designer amenities such as a kitchen, dining room, laundry machines, etc. making guests feel more at home
• high living standards for short or extended periods of stay

SMART HOSTELS (IOT) – ENHANCE THE GUEST EXPERIENCE USING IOT
&AND HOSTEL

&AND HOSTEL is a well-recognized brand of smart hotels. Originally a Smartphone idea company, its founders spotted an opportunity in the local hotel industry to combine alternative lodging with IoT, enhancing the personalized experience and well-being of each guest. Managing 11 hostels in Tokyo, Osaka and Fukuoka, &AND HOSTEL aims to be the No. 1 Smart Hostel Operator in 2020 focusing on the following key attributes:

• different layouts catering to larger groups (i.e. friends or family) with a common lounge area to interact with other guests
• central locations near tourist areas and airport
• guests customize their experience first-hand with state of the art IoT technology
• consistent and streamlined operational services using IoT (ie. remote control of interior environment, lighting, appliances, etc.) through smartphone technology promoting cost saving

New Concept Smart Hostel near Ueno

Arakawa-ku, Tokyo
Property ID: 8443

Land Size: 153 sq.m. / 1,647 s.f. approx.
Total Gross Floor Area: 766 sq.m. / 8,246 s.f. approx.

Located near downtown Tokyo yet with great access to Ueno, Asakusa, Ginza and Roppongi, this boutique hotel has newly been opened under the single brand “&AND HOSTEL”. Featuring 67 keys, the hotel can accommodate up to 120 guests.  With long term fixed rental, the new owner can enjoy stable income.

Price: ¥750,000,000 JPY ($6.9M USD approx.) (incl c-tax)
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Smart Hostel in Heart of Osaka

Chuo-ku, Osaka
Property ID: 8444

Land Size: 302 sq.m. / 3,245 s.f. approx.
Total Gross Floor Area:  1,549 sq.m. / 16,672 s.f. approx.

Within a 5 minutes’ walk to Osaka Metro station with easy access to Namba and Shinsaibashi, this originally commercial building has been converted into a brand new hotel. Featuring 83 keys accommodating up to 136 guests targeting inbound as well as biz travellers, the hotel will be operated under “&AND HOSTEL” brand with fixed lease term.

Price: ¥1,440,000,000 JPY ($13.26M USD approx.) (incl c-tax)
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Residential Apartment En-Bloc

Minato-ku, Tokyo
Property ID: 8442

Land Size: 169 sq.m. / 1,824 s.f. approx.
Total Gross Floor Area: 464 sq.m. / 4,989 s.f. approx.

Situated in Shirogane of Minato-ward within a 10 mins’ walk from Hiroo station, this classy residential building offers 14 units, currently operated by OYO, the building can also be used as “Minpaku”, alternative lodging to maximize its return.

Price: ¥583,000,000 JPY ($5.37M USD approx.) (incl c-tax)
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Brand New Residential Building in Ebisu

Shibuya-ku, Tokyo 
Property ID: 8399

Land Size: 139 sq.m. / 1,494 s.f. approx.
Total Gross Floor Area: 464 sq.m. / 4,989 s.f. approx.

Occupying a superior location in Ebisu, this brand new residential en-bloc is within a 9 mins’ walk to Ebisu Station and Daikanyama is also within walking distance. Featuring 12 units ranging size from 30 to 40 sq.m. targeting single or young couples. Stable cash flow can be expected.

Price: ¥732,000,000 JPY ($6.74M USD approx.) (incl c-tax)
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Why not own a unique hospitality asset in Japan fully managed by these talented operators? For enquiries and private consultation, we invite you to contact us now.

Mayumi Lambon (E-308403)
+852 9109 1526   [email protected]

Originally published in COLLECTION, 1 Jan 2020