Mori Trust acquired the Fairfield by Marriott Osaka Namba as part of its hotel strategy.
With Osaka projected to host over 28 million visitors at the World Expo next year, Tokyo-based Mori Trust has picked up a 300-key hotel in the city from private equity major PAG which could set it up to profit from an expected tourism boom.
The private firm has acquired the Fairfield by Marriott Osaka Namba from Hong Kong-based PAG for an undisclosed sum, according to a LinkedIn post by the transaction’s broker CBRE last week.
With Osaka expected to welcome Japan’s first casino in 2030, in addition to the 2025 expo, hospitality properties in the city have become a top target for investors with the trust adding its Osaka prize to its JPY 470 billion in existing assets.
“With the Expo and casino resort as tailwinds, Osaka will continue to attract more and more visitors from Japan and abroad,” according to a report from the JLL’s Research team in Japan. “Hotel deals have become more common in anticipation of the tourism boom in Greater Osaka.”
Tourism Boom
Completed in 2020, the hotel has a gross floor area of 10,362 square metres (111,539 square feet) spanning 14 storeys, and is within 10 minutes’ walk of three rail stations – Namba station, JR Namba station, and Osaka Namba station.
The hotel is also located a 20-minute drive from Yumeshima, an artificial island in Osaka Bay set to be the venue for the 2025 Expo, as well as the future home of an $8.6 billion casino resort operated by Japan’s Orix Corp and US-based MGM Resorts currently expected to launch in 2030.
Mori Trust chief executive Miwako Date
The hotel is poised to benefit from Osaka’s upcoming Naniwasuji line, an underground railway expected to open in 2031 that will connect JR Namba station with Osaka station and Kansai International Airport.
The Fairfield by Marriott Osaka Namba is reported to have been among a set of three hotels marketed by PAG last year, along with the Holiday Inn & Suites Shin Osaka and the KAYA Kyoto Nijo Castle, BW Signature Collection. The latter two hotels are said to still be in the private equity firm’s portfolio.
The acquisition, which closed in January, is part of Mori Trust’s “Advance 2030” plan to supply 2,000 hotel rooms in Japan’s urban and resort areas by 2030, with a focus on the Osaka and Kyoto areas.
“Osaka Prefecture is currently second in the country in terms of the number of overnight guests after Tokyo, with demand recovering at an increase of 18.4 percent compared to 2019, and is expected to continue to grow,” Mori Trust said in its announcement of the transaction. “As demand increases, there is a concern that there will be a shortage of international brand hotels, and through this acquisition, we aim to help expand tourism demand in the Osaka area.”
With the latest Osaka hotel acquisition completed, the developer’s hospitality portfolio now includes 32 assets totaling over 4,500 keys, according to the company’s website.
Mori Trust’s acquisition comes after Osaka saw a rebound in tourism in 2023 with the city welcoming over 1 million foreign visitors in October, exceeding the 991,000 recorded in the same month in 2019.
Hospitality in Focus
Mori Trust’s acquisition comes as foreign and Japanese investors continue to snap up hospitality assets in the Kansai region around Osaka and Kyoto, with the two cities ranking among the top tourist destinations in Asia’s second-largest economy.
On 30 January TSE-listed REIT Sankei Real Estate announced that it would acquire three hotels including the 142-key Grids Premium Hotel Osaka Namba from its sponsor, Sankei Building.
In December, an Alyssa Partners-managed fund backed by an unnamed offshore investor bought a trio of Osaka hotels totaling 518 keys from Singapore’s CapitaLand Ascott Trust and US private equity titan Blackstone acquired the Moxy Kyoto Nijo hotel from Goldman Sachs,
During that same month an unnamed buyer advised by Singapore-based Anglo Fortune Capital Group bought the SH by the Square Hotel Kyoto Kiyamachi from Tokyo-based real estate investor Kasumigaseki Capital.
Note: an earlier version of this story referred to Mori Trust as a listed REIT. It is a private company. The reference to the Kaya Kyoto hotel has also been updated to show that the property is managed as a BW Signature location, not a Holiday Inn. Mingtiandi regrets any errors.
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