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Business Times
4 days ago
- Business
- Business Times
Frasers Hospitality's Tokyo debut part of growth strategy to expand to business gateway cities
[TOKYO] Although the completion of Frasers Hospitality's newest accommodation in Japan, Yotel Tokyo Ginza, was delayed by four years, it was a blessing in disguise. Since its opening last December, the hotel has tapped into Japan's surging tourism boom on the back of a weaker yen, an outcome that Jason Leong, head of investment and asset management at Frasers Hospitality, described as better than expected. Occupancy for the hotel is about 70 per cent on average, a good performance for a hotel that has been in business for only six months, he said. Yotel Tokyo Ginza is part of a broader strategy by Frasers Hospitality to expand its footprint. In July 2024, the group announced plans to add 20 properties to its portfolio over the next four years, including nine slated to open in China and Vietnam within the next two years. Frasers Hospitality, a strategic business unit of Frasers Property, manages over 100 properties across more than 20 countries, with a presence largely in the Asia-Pacific and Europe. The properties range from hotels to serviced apartments and premium rental apartments. Leong's comments were made in an interview with The Business Times in Tokyo, a day after the official opening of Yotel Tokyo Ginza on Jun 9. A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up The 244-room hotel, Frasers Hospitality's first investment and development project in Japan, is located in the popular Ginza shopping district. A collaboration between Frasers Hospitality and British hotel operator Yotel, the property sits on what was previously a car park, which was acquired in 2018. The hotel was originally intended to open in time for the Tokyo Summer Olympics in 2021, but pandemic-related delays and rising construction costs prompted Frasers Hospitality to hold off on the plan. The pause enabled the company to refine the hotel's concept and positioning. 'And we are quite glad to have opened it now, when the (tourism) market is booming,' said Leong. Launched in June 2025, Yotel Tokyo Ginza is Frasers Hospitality's first investment and development project in Japan. PHOTO: FRASERS HOSPITALITY Generating returns The Yotel partnership reflects Frasers Hospitality's wider real estate strategy, which is to be 'brand agnostic' in the area of partnerships. 'Whenever we look at an acquisition, the question we ask is: 'How can I maximise the value of this asset or what I'm building?'' he said. This means that the company must find the best operator, outside of Frasers itself, or within, to manage and operate a property to drive the best capital appreciation over time, said Leong, noting that the focus of the company's real estate business is on generating returns from physical assets. While Frasers Hospitality prefers to use its own brand for longer-stay assets such as serviced apartments and premium rental units – given that it has already built up its branding in this segment – it is open to relying on third-party operators for shorter-term stay hotels such as Yotel Tokyo Ginza. The group's investment strategy is focused on global business gateway cities such as Tokyo, Shanghai and London, which give access to the broader region. Changing traveller preferences Frasers Hospitality's core audience includes corporate travellers and free, independent travellers. The latter prefer customised experiences over tour groups, and are willing to pay a premium for unique lifestyle offerings. They also travel less frequently, but for longer stretches, partly due to the flexibility of remote work. Guests want smart IT systems to support remote work, but also the opportunity to live like a local. These preferences shape how Frasers Hospitality curates its programmes for its properties. 'That's where Frasers Hospitality can offer or work with different operators to find a business model that suits (the needs of) these travellers,' said Leong. The profile of travellers in the extended-stay segment has also changed. Expatriates with families once dominated this segment, but today's travellers tend to be solo professionals on three- to six-month corporate projects, or independent business travellers relocating for two to three years without company sponsorship. They also want the opportunity to immerse themselves in the local culture. Frasers Hospitality has tailored offerings in the extended-stay space for these groups. For instance, Modena by Fraser Shenzhen, a premium rental apartment in China that soft launched in March, targets business travellers on mid- to long-term assignments, and also those who want a higher standard of living without purchasing property. The property provides dedicated zones for activities such as yoga and gaming, as well as community programmes that bring residents together. Market considerations Beyond guest experience, market factors such as interest rates, growth potential and timing of entry play a critical role in investment decisions. However, this does not mean that Frasers Hospitality wants to grow for the sake of growing, said Leong. 'We very much want to grow to a relevant scale (in existing markets), but subject to the right conditions.' This means anchoring itself in markets that are business gateway cities and focusing on 'quality projects' that can generate returns, he said. When asked about how the ongoing privatisation attempt of Frasers Hospitality Trust (FHT) would affect Frasers Hospitality's operations, he declined to comment. Frasers Hospitality manages the properties of FHT, which is in the middle of a privatisation attempt by its sponsor, Frasers Property. However, Leong said that the group adopts a long-term business view on all its assets, including that of Frasers Hospitality.
Straits Times
10-06-2025
- Business
- Straits Times
Singapore's Frasers ties up with Britain's Yotel in first development project in Japan
The newly opened 244-room Yotel Tokyo Ginza is owned by Singapore's Frasers Hospitality and operated by British lifestyle hotel chain Yotel. ST PHOTO: WALTER SIM Singapore's Frasers ties up with Britain's Yotel in first development project in Japan – Singapore's Frasers Hospitality and Britain-based lifestyle hotel chain Yotel on June 9 celebrated several firsts with the official opening of the 244-room Yotel Tokyo Ginza. It marks the first time the two brands have teamed up, Yotel's debut in the Japanese market and Frasers Hospitality's maiden ground-up investment and development project in the country. The Singapore company acquired the land and oversaw the building's construction before handing the operations over to another company. Situated on the periphery of Ginza, the Japanese capital's most prestigious shopping district, the 14-storey boutique hotel offers compact 'cabins' of between 14 sq m and 18 sq m in size, as well as family units comprising two connecting rooms. The hotel is strategically positioned near the Shimbashi district, a haven for salarymen, and the Shiodome business district, which caters to business and leisure travellers alike. This marks a rare ground-up project for Frasers Hospitality, as most of its real estate investments thus far have been the acquisition of existing assets. The company is riding the crest of a boom in both real estate investment and inbound tourism in Japan, which has been a draw for many Singaporean hospitality and real estate firms. Recent and upcoming entrants include Pan Pacific Hotels Group, SC Global, Banyan Group and Capella Hotels & Resorts. This comes as Frasers Hospitality has embarked on what it describes as 'twin engines of growth'. It operates hotels and serviced apartments across seven brands – including Fraser Residence, Capri and Modena – that may be owned by a third-party company. It is also acquiring real estate – plots of undeveloped land as well as ready-built property – that can be operated by another owner. Yotel Tokyo Ginza was one such property constructed on undeveloped land. Mr Jason Leong, Frasers Hospitality's executive director and head of investment and asset management, told The Straits Times that he takes a 'brand-agnostic' approach in assessing potential investments. 'Unlike in the past, when we tend to build a Frasers property on any plot of land that we buy, the priority now is to focus on the best use for a plot of land,' he said. 'We are very returns-driven, and it is about finding the best business model that suits the asset.' In Japan, Frasers Hospitality owns the ANA Crowne Plaza Hotel in Kobe – which was bought in 2014 through a real estate investment trust – as well as a 124-unit premium rental apartment in Osaka, which was acquired in 2023 under a joint venture with Hong Kong-based Alyssa Partners. It separately manages – without owning the real estate – the 114-key Fraser Residence Nankai Osaka, which was built in 2010, and the 170-unit Fraser Place Roppongi Tokyo, which is set to open in early 2026. The collaboration with Yotel was driven by the site's characteristics and market demands, Mr Leong said, adding that percentage returns were in the 'high single digits'. He declined to reveal how much the company invested. He added that Yotel's brand concept of a lifestyle micro-hotel allows them to maximise the number of rooms in a prime real estate location, catering to guests seeking shorter stays. Space constraints made it difficult for Frasers to adapt the site for its brands, which have larger rooms and are more focused on medium- to long-term stays. Yotel Tokyo Ginza was completed four months ahead of schedule and has been open to guests since December 2024 , half a year before its June official opening . A guest room at Yotel Tokyo Ginza. ST PHOTO: WALTER SIM Occupancy has been above 70 per cent, with room rates starting at about 22,000 yen (S$195) a night, including taxes. Rates have, however, soared above 40,000 yen a night during peak travel periods , such as during the height of the cherry blossom season in March and April. This makes Yotel more expensive than other ubiquitous no-frills Japanese business hotel chains, such as APA Hotels. For instance, rates for an 11 sq m room at the nearby APA Hotel Shimbashi-Toranomon range from around 7,000 yen a night in July to 30,200 yen a night in November, based on checks by ST . Yotel markets itself as being ideal for the 'modern urban explorer', with plenty of fun elements. Its reception is dubbed 'Mission Control', while the vibrant social space 'Komyuniti' triples up as a restaurant, lounge and bar with daily happy hour specials. Robots deliver items such as extra towels and bottled water to guest rooms, which are equipped with smart TVs and mechanised beds with adjustable reclining angles. Guests should not expect a very Japanese experience . Rooms are not equipped with amenities that are common in Japanese hotels, such as bathtubs and yukata robes or pyjamas. Toiletries like shampoo and body wash are from Australian beauty brand Urban Jungle, which uses South Korean ingredients. Also, unlike Japanese business hotels which may feel cramped, Yotel's rooms are designed such that guests should not feel claustrophobic, having decent space to store big luggage or roll out a yoga mat to stretch . Given its location, travellers can pop out for late-night ramen in Shimbashi or a nightcap at one of Ginza's many cosy bars. Don Quijote discount chain is around the corner, and those who are young at heart will enjoy shopping at the nearby Hakuhinkan Toy Park. Frasers Hospitality's approach to buying real estate is 'not 100 per cent leisure', said Mr Leong, who added that it looks for 'a good mix of corporate and leisure potential'. If the site were located elsewhere in Tokyo, farther away from the business centre, the company might have walked away, he said. 'Do we believe in the Japan story? Yes, we do,' he said. 'But I'm not going to go all-Japan, I'm not going to Niseko (in Hokkaido), that's not my space.' As for moving into fast-growing second-tier cities such as Fukuoka, Nagoya or Sapporo, Mr Leong said: 'We don't want to spread ourselves too thin. The preference is to have a few more assets concentrated in gateway cities rather than having one asset in each city.' Walter Sim is Japan correspondent at The Straits Times. Based in Tokyo, he writes about political, economic and socio-cultural issues. Join ST's Telegram channel and get the latest breaking news delivered to you.
