Hulic, a major real estate company, recently announced plans to redevelop a prominent corner block in Ginza into a luxury ryokan-style hotel with an opening scheduled for 2025.
Six of the twelve floors will contain a 38-room ryokan. This will be Hulic’s 13th luxury ryokan property under the Fufu brand. The company is aiming to attract wealthy domestic and foreign travelers, with the most expensive room to be priced around 300,000 Yen (US$2,400) a night. The largest suite will be around 130 sqm (1,399 sq.ft), and all rooms will be fitted out with their own terraces and private hot spring baths, making this a stand-out project from its local competitors. Hulic is expecting a third of the guests to be foreign tourists.
Tentatively named Fufu Tokyo Ginza, approximately 20 billion Yen will be spent building a new 12-story commercial building. It will replace the 48-year old, 9-story Hulic Ginza Building that sits on the corner of Chuo-dori Avenue and Ginza Yanagi-dori Street. Hulic currently owns 34 buildings in Ginza.
With expectations that the pandemic will soon be over, investment in the global hotel market is heating up. In 2022, JLL is forecasting total investment to be 40% higher than in 2021, with hotel investment tipped to exceed US$90 billion. Even domestically, hotel projects are starting to come back to life. A highlight will be the reconstruction of the Imperial Hotel in Chiyoda ward which will take place from 2024 to 2036. In 2025, a Waldorf Astoria hotel is expected to open in Osaka, with a second one to open in Nihonbashi, Tokyo, in 2026.
Hotel operating ratios, however, have yet to recover. According to STR, the average operating ratio in February was 43.6%, about half the level seen before the pandemic. While demand in the luxury accommodation sector has stabilized, the cheaper business hotel sector has suffered from an over-supply in the lead-up to the 2020-2021 Olympics.
The Nikkei Shimbun, April 7, 2022.
Hulic News Release, April 8, 2022.
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