City Developments Ltd has acquired a 256-room Osaka hotel for JPY 8.5 billion ($58 million), chalking up the Singapore property giant’s third hospitality acquisition this year.
CDL paid roughly $230,000 per key for the Bespoke Hotel Shinsaibashi, a freehold property in Osaka’s Shinsaibashi commercial district. Opened in 2019, the hotel is within a five-minute walk of luxury retail on Midosuji Avenue and also sits near the popular Shinsaibashi-suji shopping street, CDL said Thursday in a release.
No seller was mentioned, but the Bespoke Hotel Shinsaibashi is operated by Nest Hotel Japan Corporation. CDL executive chairman Kwek Leng Beng said the company saw Japan’s post-pandemic tourism rebound as an opportunity to expand its hotel portfolio.
“Our group owns the 329-room Millennium Mitsui Garden Hotel in Tokyo Ginza as well as other rental apartment assets in Yokohama and Osaka,” Kwek said. “This investment is aligned with our group’s strategy to actively grow and diversify our global real estate portfolio.”
Tourism Set to Take Off
CDL noted that tourism in Osaka is likely to strengthen in the coming years, with the city set to host the six-month-long World Expo in 2025 and a $10 billion MGM casino resort scheduled to open in 2030.
Inbound tourism from the rest of Asia has continued to grow, CDL said, while the weaker yen has sparked a rebound in US and European tourists. The company also underlined China’s recent lifting of restrictions on group tours as another positive for Japan’s hotel sector.
The acquisition of the Bespoke Hotel Shinsaibashi follows CDL’s purchase of the 408-room Nine Tree Premier Hotel Myeongdong II in Seoul for KRW 140 billion ($110 million), in a deal announced in July. The seller of the freehold 17-storey property was a REIT managed by a unit of Shinhan Financial Group.
In March, CDL bought the 416-key Sofitel Brisbane Central from Canada’s Brookfield Asset Management for A$177.7 million ($119 million), giving the Singapore builder its third hospitality asset Down Under.
City Serves Up Deals
With the rebound in cross-border traffic boosting interest in Osaka’s hospitality sector, BentallGreenOak acquired the landmark Rihga Royal Hotel Osaka earlier this year for an undisclosed price believed to be at least JPY 50 billion ($385 million).
The North American fund manager signed an agreement with Japanese hospitality firm Royal Hotel to buy its flagship property in a deal that saw British hospitality operator IHG Hotels & Resorts add the hotel to its management portfolio.
Singapore-based Thakral Corp revealed this week that it had sold its 50 percent stake in a 120-key business hotel in Osaka for an undisclosed sum. The firm said it achieved a S$1.7 million ($1.3 million) post-tax gain from the sale of its half-stake in the Kita-Umeda district property formerly known as R Hotels Inn to an undisclosed buyer.