Frasers Hospitality And Yotel Forge First Partnership Japan Aiming Strengthen Market Presence
The grand opening of Yotel Tokyo Ginza was celebrated on June 9, marking the first ground-up development in Tokyo for Frasers Hospitality and the beginning of its partnership with British lifestyle hotel brand Yotel. This 14-storey hotel is the first Yotel property in Japan and serves as their flagship property in the country.
Located in the prestigious Ginza district, the 244-bed hotel caters primarily to short-stay business travelers and budget-conscious leisure guests. It offers a range of room options, including sizes ranging from 150 to 193 sq ft, and also features a 26-space multi-storey carpark for visitors.
According to Eu Chin Fen, CEO of Frasers Hospitality, their decision to partner with a third-party hotel operator like Yotel for their first ground-up development project in Tokyo showcases their brand-agnostic investment strategy and reflects a deliberate, market-driven approach.
Jason Leong, executive director and head of investment and asset management of Frasers Hospitality, explains that Yotel Tokyo Ginza was initially planned to be a Capri serviced residence, with the goal of opening before the 2020 Summer Olympics. However, due to the Olympics being postponed to the following year because of the Covid-19 pandemic, they decided to postpone development until construction costs stabilized.
Leong also mentions that the high construction cost at the time made it challenging to fit their larger-sized rooms, which cater to long-term stays, while still maximizing the number of rooms to justify the investment cost. This led them to seek partners, and they saw the synergies between them and Yotel, as they both share a vision of offering differentiated hospitality products in the competitive Tokyo hotel market.
Construction began in 2022, and the hotel opened in December of that year, four months ahead of schedule. According to Yotel CEO Hubert Viriot, the opening of Yotel Tokyo Ginza marks the start of their ambitious plans for growth in the Japanese and wider Asian market. He also notes that the partnership with Frasers aligns with Yotel’s growth strategy in Japan.
The hotel boasts of some of the brand’s latest features, such as robotic concierges, motorized smart beds, and a fully digital guest experience. Its design concept is inspired by Japan’s focus on technology, innovation, and space-saving functionality.
With Expo 2025 currently taking place in Osaka until October, the hotel has seen a boost in performance due to spillover tourism and international business visitors from the World Expo. As a result, the average occupancy has risen above 70% this month.
According to market research by Colliers, Japan welcomed a record 36 million foreign tourists last year, who spent an estimated JPY8.1 trillion ($71.5 billion), a 69% increase from 2019. Kei Sumiyoshi, senior director and head of hotels and hospitality at Colliers Japan, notes that a relatively weaker yen has contributed to the surge in both tourist arrivals and spending compared to most major currencies.
At the same time, domestic tourism has also remained strong, with overnight stays almost matching pre-pandemic levels. Local tourist spending has also increased by 15% since 2019. Sumiyoshi explains that Japan’s hospitality sector is entering a new era of pricing power and global appeal, with average daily rates (ADR) reaching record highs, particularly in the luxury segment. This has reinforced investor confidence in hospitality assets in Japan and will likely drive up inbound foreign investment capital in the long term.
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Leong mentions that the hospitality market in Japan is seeing stiff competition from institutional investors such as REITs and Chinese-based funds. However, Frasers Hospitality takes a financially responsible approach and is selective in their acquisitions, favoring high-quality assets where they can unlock value and generate strong returns. They also have a clear focus on their core expertise of managing their investment real estate portfolio, specializing in long-term rental lodging, premium rental apartments, and select asset conversions.
Frasers Hospitality plans to expand its presence in Japan with the upcoming launch of Fraser Place Roppongi Tokyo in the first quarter of 2026. Located in the heart of the city, this 170-key long-stay residence will offer a mix of studios and two-bedroom apartments, catering to extended-stay travelers.
The hospitality group owns and operates six different brands, including Fraser Suites, Fraser Residence, Fraser Place, Capri by Fraser, Modena by Fraser, and their luxury brand Malmaison, which they acquired in 2015. They also have several other new openings this year, including three properties in China, namely Modena by Fraser Shenzhen, Modena by Fraser Wujiaochang Shanghai, and Modena by Fraser Dalian.
Meanwhile, in Malaysia, they have Fraser Residences Putrajaya, a 283-unit serviced apartment set to open in September, and Capri by Fraser Penang, a 248-unit property that will welcome guests in December.
Eu states that their brand-agnostic investment approach enables them to select and partner with the best-fit operators based on each project’s unique parameters and investment model. Leong adds that as they consider their expansion plans, they are actively looking for partnership opportunities with asset owners and portfolio managers.
CBRE, in their market report on the Asia Pacific hotel market, published on June 19, mentions that most of the major hotel groups in the region have shifted their operator strategy towards a more asset-light model. They also note that hospitality brand owners and operators are keen to grow their franchise footprint in Asia Pacific, especially in the midscale and select-service segments.
The consultancy expects hospitality firms to focus on acquiring local hotels to grow their portfolios, with operators favouring adaptive reuse and revitalizing underused assets as new development costs outpace redevelopment. They also see the growing trend of mergers and acquisitions, partnerships, and long-term agreements among hospitality operators to be crucial due to the shrinking market for new developments and rising construction costs.
Frasers Hospitality’s CEO, Eu Chin Fen, emphasizes that Japan’s robust long-term fundamentals reinforce their commitment to prioritizing investment opportunities in key cities. They aim to build a diversified portfolio in the market, covering everything from hotels to premium rental apartments.
Leong concludes that the company’s goal is to optimize the performance of their existing portfolio through asset enhancements while selectively expanding in key segments and locations with strategic partners.