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Cheryl Arcibal

Hotels are proving to be the darling of many investors across the globe, as consumer zeal for travel continues despite economic uncertainties, according to analysts.
Within the segment, Japan is the runaway winner, with hoteliers and investors picking the land of sakura, sushi and sumo as the top investment destination.
“The hospitality segment is seeing a silver lining after Covid,” said Sabine Schaffer, co-founder and CEO in Europe of Australia-based hotel investor and operator Pro-invest Group. “Hospitality was probably the least favourite asset class as world travel came to a halt following the surge of Covid, but it has become one of the more sought-after asset classes.”
More than half of 300 investors surveyed worldwide by CBRE earlier this year said they intended to buy more hotel assets this year than in 2023, while only 14 per cent expected to buy fewer hotels.
Top reasons cited for increased hotel investment included expectations of higher returns, price adjustments, distressed opportunities and a lower cost of capital.
About three quarters of the respondents also said they were most keen on opportunistic and value-added hotel assets this year.
Two factors are spurring hotel investment, according to Schaffer. One is so-called revenge travel, as people make up for travel opportunities they missed during the pandemic. The other is the younger generation’s preference for holiday experiences over ownership, Schaffer added.
Investors find hotels attractive because enhancements can easily be undertaken, including repositioning assets to attract different consumer segments, Kenneth Gaw, managing principal and co-founder of Hong Kong-based private equity real estate firm Gaw Capital, said during a panel discussion at the International Hospitality Investment Forum.

“We specifically like hotels because it’s a consumer-oriented business,” Gaw said during the event, which took place September 9 to 12 at the Regent Hong Kong in Tsim Sha Tsui. “We really focus on the upper upscale luxury segment and we think that even during downturns, the luxury customers still travel.”
Gaw Capital has investments in the Regent Hong Kong, the Hyatt Regency Tokyo and the Four Seasons in Bora Bora, among others.
With margins “coming back”, hospitality is “immensely strong”, said Simon Manning, managing director of Nina Hospitality, which owns and operates hotels in Hong Kong and contributes about 12 per cent of total revenue to Chinachem Group.
Japan is the favourite investment target as both local and overseas tourists are driving the growth of the hospitality industry in Asia’s second-largest economy.
With interest rates at 0.25 per cent and tourist offerings among the most diverse in the world – from skiing in Hokkaido to beaches in Okinawa – Japan has a lot to offer for investors.
“Japan’s unique culture and natural beauty is unlike any other area in the world,” said Glass Wu, CEO and founder of Japan Hana Real Estate, which markets all property segments in Japan to family offices, high-net-worth individuals and investors across the globe. “What we hear from our clients is that they are spending more on travel these days and with the yen weakening against the dollar, it’s so much cheaper to travel and shop in Japan.”
Tokyo is aiming to welcome 60 million visitors by 2030, with these tourists expected to boost the economy by spending 15 trillion yen (US$106.6 billion).
Hilton opened the 308-room Canopy by Hilton Osaka Umeda this month, said Clarence Tan, senior vice-president of development in Asia-Pacific for the US-based hotel group.
Mainland China, despite a slower economy and long-lasting property crisis, is still getting attention from the likes of Radisson Hotels.
“We sign 150 new Radisson hotels in China every year … mainly in the midscale and upscale segments,” said Ramzy Fenianos, chief development officer in Asia-Pacific for the hotel group, which is headquartered in Minnesota in the US.
Meanwhile, the Mandarin Oriental Hotel Group earlier this month opened the Mandarin Oriental Qianmen in Beijing, its second hotel in the Chinese capital.
“It’s 42 keys within a hutong, which is the traditional courtyard houses, and it’s actually dotted within the local community,” said James Mabbutt, development director of the Hong Kong-headquartered company. “We’re positioning ourselves as a really experienced creator in this project. Across the region, including China, the opportunity is really experience-driven, with much smaller luxury properties, and this is the place where we really focus.”
Southeast Asian countries also present good opportunities for investors, said Taimur Baig, head of global economics and macro strategy for interest rate, credit and currency at DBS Group Research. With their huge and young population and with economies that are among the world’s fastest growing, there is “a lot to be optimistic about in the region over the next decade”, he said.


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Japan is the favourite investment target amid a surge in tourism, a weak yen and low interest rates


Japan is the favourite investment target amid a surge in tourism, a weak yen and low interest rates.
