Yotel Tokyo Ginza celebrated its offical opening on June 9, marking Frasers Hospitality’s first ground-up development in Tokyo and the start of its partnership with British lifestyle hotel brand Yotel. For Yotel, this 14-storey hotel marks its debut in Japan and serves as its flagship property in the country.
Situated in the heart of Tokyo’s prestigious Ginza district, the 244-bed hotel primarily serves short-stay business travellers and cost-conscious leisure guests. Offering a range of rooms from 150 to 193 sq ft, the property also features a 26-space multi-storey carpark for visitors.
“Partnering with a third-party hotel operator like Yotel for our first ground-up development project in Tokyo, Japan, underscores Frasers Hospitality’s brand-agnostic investment strategy and reflects a deliberate, market-driven approach,” says Eu Chin Fen, CEO of Frasers Hospitality.
From a real estate investment perspective, Yotel Tokyo Ginza represents a focus on driving returns and positioning an asset to bring out its best qualities, says Jason Leong, executive director and head of investment and asset management of Frasers Hospitality.
From carpark to lifestyle hotel
When Frasers Hospitality acquired the former carpark site in 2018, it planned to develop a Capri serviced residence, targeting an opening in time for the 2020 Summer Olympics. However, the Olympics were postponed to the following year due to the Covid-19 outbreak.
“It was an ambitious plan then to develop and operate a new hospitality development to fit the timeframe we gave ourselves,” recalls Leong. He adds that the high construction cost at the time also worked against them, as most local construction companies were busy supporting the numerous Olympic-related development projects.
Given the heightened risk environment, Frasers Hospitality chose to postpone development until construction costs stabilised. “It also gave us time to re-evaluate the business model and assess if a Capri would be the best fit for a compact-sized site in a prime district like Ginza,” says Leong.
The 244-bed hotel primarily serves short-stay business travellers and cost-conscious leisure guests.
Initial development plans revealed that site constraints made it difficult for Frasers to fit the larger-sized rooms characteristic of its brands, which often cater to long-term stays, while maximising the number of rooms to justify the investment cost.
It was clear the site called for a different business model, prompting Frasers Hospitality to seek partners. “We saw the synergies between us and Yotel given their branding and desire to offer a differentiated hospitality product to the competitive Tokyo hotel market,” says Leong.
Frasers broke ground on the site in 2022, with the new hotel opening last December, around four months ahead of schedule. Eu highlights that the prime location and Frasers’ investment strategy demanded a lifestyle hotel brand with smart design and operational efficiency to attract both international and domestic business and leisure travellers.
Shared vision
Speaking at the official opening ceremony on June 9, Yotel CEO Hubert Viriot notes that Yotel Tokyo Ginza marks the start of ambitious plans for growth in the Japanese and wider Asia market. He adds that the partnership with Frasers aligns with Yotel’s growth strategy in Japan.
“We have a shared vision for creating high-performing, future-ready assets, making them a seamless partner from both a commercial and operational perspective,” adds Viriot.
The hotel showcases some of the brand’s latest features, including robotic concierges, motorised smart beds, and a fully digital guest experience. Its design concept is also inspired by Japan’s emphasis on technology, innovation, and space-saving functionality.
Backed by a flagship property in Japan, Yotel is targeting new build projects alongside conversions and adaptive reuse opportunities for its three brands — Yotel, YotelAIR and YotelPAD, says Rohan Thakkar, chief development officer of Yotel.
The opening of Yotel Tokyo Ginza coincides with Expo 2025, currently taking place in Osaka through October. Spillover tourism and international business visitors from the World Expo have boosted the hotel’s performance, with average occupancy rising above 70% this month.
Yotel CEO Hubert Viriot (left), and Panote Sirivadhanabhakdi, group CEO of Frasers Property.
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 supported the surge in both tourist arrivals and spending compared to most major currencies.
At the same time, domestic tourism has remained strong, with overnight stays nearly matching pre-pandemic levels. Local tourist spending has also risen by 15% since 2019. “Japan’s hospitality sector is entering a new era of pricing power and global appeal,” says Sumiyoshi. “With average daily rates (ADR) reaching record highs, particularly in the luxury segment, we’re seeing a structural shift in value perception.”
He adds that the combination of record inbound tourism, resilient domestic demand, and a wave of high-profile brand entries has reinforced investor confidence in hospitality assets in Japan, and this will likely drive up inbound foreign investment capital over the long term.
Frasers Hospitality’s Leong: We saw the synergies between us and Yotel given their branding and desire to offer a differentiated hospitality product to the competitive Tokyo hotel market.
The influx of foreign-based investment and domestic capital has heated competition for high-quality hospitality assets in major tourist destinations across Japan, including Tokyo, Osaka and Kyoto, says Leong.
“There is stiff competition from institutional investors like REITs and Chinese-based funds in recent years. But we take a financially responsible approach, we do not grow for the sake of expanding but are selective in our acquisitions, favouring good-quality assets where we can unlock value and generate strong returns,” he adds.
He notes that Frasers Hospitality has a clear focus on its core expertise when managing its investment real estate portfolio — specialising in long-term rental lodging, premium rental apartments and select asset conversions.
Expanding market presence
Frasers Hospitality is set to expand its presence in Japan with the upcoming launch of Fraser Place Roppongi Tokyo, expected to open in the first quarter of 2026. The 170-key long-stay residence will offer a mix of studios and two-bedroom apartments, catering to extended-stay travellers in the heart of the city.
The hospitality group owns and operates six different hospitality brands, ranging from Fraser Suites, Fraser Residence, and Fraser Place; to Capri by Fraser, Modena by Fraser, and its luxury brand Malmaison, which it acquired in 2015.
Other new openings by Frasers this year include three properties in China, namely the 325-key Modena by Fraser Shenzhen, which launched in March; the 307-unit Modena by Fraser Wujiaochang Shanghai, which had its soft-opening last month; and the 120-unit Modena by Fraser Dalian, which will open in 4Q2025.
“The Chinese hospitality market is central to our long-term strategy for Asia,” says Frasers Hospitality’s Eu. She adds that the new Modena properties represent a significant step in strengthening the company’s presence in China, anchored by its differentiation strategy with “experience-led” stays. These new openings will bring the Frasers Hospitality portfolio in China to nine properties by the end of this year.
In Malaysia, the company has Fraser Residences Putrajaya, a 283-unit serviced apartment that is set to open in September, as well as Capri by Fraser Penang, a 248-unit property that will welcome guests in December.
Eu adds that the hotel group’s “investor-developer-manager” model has worked well, enabling the company to “create and unlock value across a balanced and diversified portfolio” with a mix of hotels, serviced apartments and premium rental apartments.
The ground-floor all-day restaurant and bar, Komyuniti, at Yotel Tokyo Ginza.
Leong shares that as the hospitality group considers its expansion plans, it is actively looking out for partnership opportunities with asset owners and portfolio managers.
In a market report on the Asia Pacific hotel market published by CBRE on June 19, the consultancy states that most of the major hotel groups in the region have shifted their operator strategy towards a more asset-light model. In addition, hospitality brand owners and operators are keen to grow their franchise footprint in Asia Pacific, especially in the midscale and select-service segments.
The report also highlights that construction costs remain high, with building conversions continuing to drive hotel growth across the region. CBRE notes that mergers and acquisitions, partnerships and long-term agreements have grown increasingly vital for hospitality operators as new development supply shrinks amid rising construction expenses.
The consultancy expects hospitality firms to focus on acquiring local hotels to grow their portfolios. With new development costs outpacing redevelopment, operators are favouring adaptive reuse and revitalising underused assets.
Strategic partnerships
Japan’s robust long-term fundamentals reinforce Frasers Hospitality’s commitment to prioritising investment opportunities in key cities such as Tokyo, Osaka and Kyoto, says Eu. She adds that the group aims to build a diversified portfolio in the market, covering everything from hotels to premium rental apartments.“Our brand-agnostic investment approach enables us to select and partner with the best-fit operators based on each project’s unique parameters and investment model,” she explains.
Meanwhile, Leong points to global inflationary pressures, including high interest rates and rising construction costs, as ongoing challenges for the hospitality investment market. Coupled with the heavy weight of institutional capital currently deployed in the market, which often sparks an undesirable bidding war, Leong notes: “From a portfolio management perspective, the risk environment has heightened for owner-operators like us to undertake new development projects.”
He adds that the company aims to optimise the performance of its existing portfolio through asset enhancements while expanding selectively in key segments and locations with strategic partners.
