The hotel industry in Japan is evolving, with new lodging models emerging, some of which incorporate elements of the burgeoning sharing economy. A panel of real estate and hotel experts at the ULI Japan Fall Conference, held in Tokyo in November, discussed the capsule hotel and other models in Japan.

George Nicholas, global head of hotels at Savills, outlined the latest trends in the Japanese and global hotel market, noting that Japan has a tremendously rich history of hospitality and that the oldest continuously operating hotel in the world is in Japan. Nishiyama Onsen Keiunkan has been operated by the same family since 705 A.D.

Nicholas argued that, worldwide, the hotel market is diverging away from the middle ground into the high-end and budget hotels. Investors and hotel companies are looking for quick rollout and delivery. The quickest and fastest route to market is by going in low and filling the market and filing your product line with easy-to-deliver hotels. At the high end, there is less of a corporate style and more trophy investments.

Moderator Fred Uruma, chief executive of Touchstone Capital Management, said the keyword in Japanese hotels today was lifestyle. Aya Aso, chief executive of hotel management company Savvy Collective, said that a key element of the lifestyle hotel was a sense of shared experience and the opportunity to meet like-minded people. Increasingly, hotels in Japan are offering smaller rooms but more shared amenities, such as cafs and lounges, where guests can interact.

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