Marriott boosts Japan portfolio with KKR deal

JAPAN - U.S.-based PE firm KKR continues to grow its portfolio in Japan announcing on Tuesday that it has acquired a portfolio of 14 hotels (3,600 rooms) from owner-operator Unizo Holdings with plans to convert the assets to Marriott International midscale Four Points Express by Sheraton brand by the second half of this year. Further details of the transaction have not been disclosed.

Last September, Unizo Holdings chose KKR as its sponsor for support through its restructuring following its bankruptcy filing last April.

The portfolio is located in major tourist destinations in 10 cities across Japan, including Hakodate, Morioka, Utsunomiya, Yokohama, Kanazawa, Nagoya, Osaka, Kyoto, Kobe, and Hakata.

Noting a “growing consumer demand for reliable-yet-affordable accommodation in the region,” Marriott Asia Pacific’s Rajeev Menon said the deal offers an opportunity to grow its midscale presence in the region. “There's a growing consumer demand for reliable-yet-affordable accommodation in the region,” he said. “Our goal is to be everywhere our guests want us to be, with the right property in the right location, at the right price point. This collaboration with KKR will expand our ability to do exactly that – starting in Japan, with opportunity to grow our midscale presence in the region.”

Last month, Marriott International and HMI Hotel Group announced a signed agreement to rebrand seven existing HMI properties in five major cities across Japan to Marriott and Courtyard by Marriott hotels.

Kensuke Kudo, managing director of real estate at KKR, said, “International and domestic tourism in Japan has rebounded strongly since the pandemic and continues to pick up pace. As demand for midscale hotels grows rapidly, we see a tremendous opportunity to offer high-quality and comfortable accommodation at great value.”

Other investments made by KKR in Japan’s real estate sector include a hotel in Shinjuku, which is expected to be rebrand as the Hyatt Regency Tokyo, according to media reports last year.