Market Trends of Hospitality Industry in Japan
This section covers the major market trends shaping the Japan Hospitality Market according to our research experts:
Increasing Number of Tourists is Driving the Market
International travelers are slowly returning to Japan. According to the Japan National Tourism Organization, the country welcomed 206,500 overseas visitors in September. It was the first time the figure has surpassed 200,000 since the start of the COVID-19 pandemic. The largest number of visitors was from South Korea at 32,700, followed by Vietnam at 30,900, the United States at 18,000, and China at 17,600.
The government has gradually eased border control measures since March, and the number of overseas visitors has subsequently increased significantly compared to 2021, when Japan's borders were almost completely closed. September saw a more than 11-fold increase compared to the same month a year earlier.
The easing of border restrictions coincided with the rapid depreciation of the yen, which has made Japan a more affordable option for many foreign tourists. The number of overseas visitors is expected to continue to climb in the months ahead.
Rising Luxury Hotel Segment Boosting the Market in Japan
The luxury hotel sector has garnered the attention of many brands looking to expand their footprint in the market.
Japan has a relatively limited number of luxury hotels compared to other countries. According to Five Star Alliance, Japan has slightly over 50 hotels listed. In contrast, many Western countries completely dwarf this number, and even neighbors in the Asia Pacific, like Hong Kong and Singapore, have a comparable number of luxury hotels despite the vast difference in the sizes of their economies.
Many well-known international brands have already started opening luxury hotels in Japan. For instance, in late 2020, The Tokyo EDITION, Toranomon, was opened, and the Marriott will keep expanding its footprint with The Tokyo EDITION, Ginza, in 2022. Investment volumes in the hotel sector were on par with the previous year and are expected to increase in 2023. Opportunities in the Japanese hotel market are likely to emerge shortly further.
