Invincible REIT buys 18 Japanese hotels for US$767m

Tokyo-listed Invincible Investment Corporation has agreed to acquire 18 hotels across Japan from a group of sellers for a combined price of JPY 82.6bn (US$766.9m).

The deals will grow Invincible’s hotel portfolio to 84 hotels comprising 14,665 rooms worth a combined JPY 434.4bn, giving it the largest hotel portfolio among J-REITs, the company announced. The J-REIT’s total AUM will expand to JPY 501.3bn on completion.

Invincible, which is sponsored by Softbank-owned Fortress Investment Group, acquired the assets at an average 5.6% appraisal net operating income yield and an average 5.8% simulated NOI yield.

Hotel MyStays Sapporo Aspen
Hotel MyStays Sapporo Aspen (image: Invincible)

The newly-acquired hotels include Hotel MyStays Sapporo Aspen, Art Hotel Ishigakijima, Hotel MyStays Fuji Onsen Resort, Hotel Sonia Otaru, Hotel MyStays Kanazawa Castle, Art Hotel Niigata Station, Hotel MyStays Nagoya Nishiki, Hotel Nord Otaru and Hotel MyStays Kagoshima Tenmonkan.

Art Hotel Asahikawa, Hotel MyStays Matsuyama, Hotel MyStays Sapporo Susukino, Hotel MyStays Sapporo Nakajima Park, Hotel MyStays Sapporo Nakajima Park Annex, Flexstay Inn Sakuragicho, MyCUBE by MYSTAYS Asakusa Kuramae, Hotel MyStays Kagoshima Tenmonkan Annex and Hotel MyStays Nayoro were also acquired.

More than 80% of the newly-acquired hotels are located in Tokyo, Osaka, Hokkaido, Kyoto, Okinawa, Chiba, Fukuoka, Aichi, Kanagawa and Yamanashi, the top 10 most popular prefectures for inbound tourists by the number of nights spent in 2018.

The company is hoping to tap into robust tourism and business demand fuelled by domestic and overseas travellers, as well as upcoming major events such as the 2019 Rugby World Cup and the Tokyo 2020 Olympics and Paralympics.

Eight of the 18 hotels are based in Hokkaido, the third busiest area after Tokyo and Osaka in terms of nights spent by inbound guests in 2018.

Invincible believes Hokkaido is one of the strongest hotel markets in its portfolio, with its existing Hokkaido hotels forecasting 8.5% year-on-year RevPAR growth during 1H 2019.

Following the deals, hotels will account for 86.7% of Invincible’s total portfolio, up from 78.6%.

All 18 hotels are operated by MYSTAYS HOTEL Management, which is also owned by Fortress.

Related stories 

Japan Hotel REIT acquires Tokyo hotel for US$561m

Sekisui House sells Japanese portfolio to REIT for US$642m

Japan Prime Realty buys Tokyo office, retail assets for US$89m

For more Asia real estate news and intelligence, subscribe to our weekly newsletter or follow APAC Real Estate on Twitter and LinkedIn.