With a diverse hotel portfolio and deep community ties, ORIX Hotel Management is revitalizing local economies, promoting sustainable tourism, and expanding access to Japan’s cultural treasures beyond the traditional Tokyo-Kyoto-Osaka corridor.
For the past 150 years and still today, Japan continues to captivate international travelers with its rich culture, deep history, and breathtaking landscapes. From the dynamic energy of bustling cities like Tokyo and Osaka to timeless temples, Japan’s appeal is remarkably diverse. Ranked No. 1 in the World Economic Forum’s Travel & Tourism Development Index, Japan stands among the fastest-growing tourism markets in Asia, alongside Thailand and Sri Lanka. A clear indicator of this momentum is the 36.8 million international tourists who visited Japan in 2024, all eager to experience everything the country has to offer. In your view, what makes Japan such an attractive destination for travelers around the world?
This is my personal opinion, but I believe Japan’s greatest strengths are its cleanliness and safety—traits consistently praised by visitors. In recent years, Japanese culture has gained growing global recognition, largely due to the popularity of anime and manga. Many foreign visitors first become interested in Japan through these subcultures. Once they arrive, they quickly realize Japan offers much more: outstanding cuisine, a rich historical backdrop, and a wide array of unique experiences.
Another key factor is the temperament of the Japanese people. We are generally kind, gentle, and welcoming. From a young age, we are taught to respect and understand others, including those from different cultures. This sense of empathy creates an environment in which international visitors feel comfortable, enhancing Japan’s appeal as a tourist destination.
Looking ahead to 2030, the Japanese government has set two clear goals: welcoming 60 million annual visitors and reaching ¥15 trillion in tourism-related spending. Equally important, however, is expanding tourism beyond the Tokyo-Osaka-Kyoto “Golden Route.”How is your company supporting this broader regional tourism strategy, and which areas in Japan do you see as having the most growth potential?
Expanding tourism beyond the Golden Route hinges on developing transportation infrastructure. For example, direct flight routes to rural areas outside of major cities like Tokyo and Osaka, along with local mobility networks, are crucial.
Alongside transportation, as a hospitality provider, it's important to clearly communicate the unique appeal of each destination and the experiences available there.
Since 2021, we’ve proactively worked to build symbiotic relationships with local communities near our hotels. We’ve assigned dedicated staff at each property to coordinate with local businesses and governments, planning and hosting events that promote regional attractions and help revitalize local economies.
Each region faces different challenges, so tailored approaches are necessary. We focus on the areas where our properties are located and actively explore how we can help revitalize those regions. This “Regional Co-Creation Project” spans 21 inns, hotels, training facilities, we operate in 10 prefectures. The aim is to elevate the long-term brand value of both the properties and their communities.
We also engage in location promotion for films and TV dramas through our “ORIX Location Service” and host collaborative events that showcase local traditional performing arts and crafts.
For example:
Through these efforts, we aim to unlock the unique appeal of each region, contributing to tourism promotion, economic revitalization, and enhanced property value.
“Omotenashi”—Japan’s spirit of hospitality—gained international recognition through the country’s Olympic campaigns. In our interviews, we’ve learned that omotenashi can be complex and interpreted differently. As a Japanese company, how do you define or interpret omotenashi?
Our portfolio includes luxury onsen resorts, mid-range hotels, and family-friendly group accommodations. What we value most is providing genuine consideration to our guests. We aim for a relationship that is neither too close nor too distant—a comfortable balance.
This allows us to anticipate guests’ needs and respond to their preferences even before they voice them. While our interpretation of omotenashi may differ from the traditional definition, it is all about providing a consistently comfortable and thoughtful stay.
Regarding business strategy, you mentioned a dual approach.
One pillar is to grow our own brands. The other is to entrust asset operations—such as Waldorf Astoria properties—to global operators like Hilton and Hyatt, leveraging their international expertise. While additional partnerships are possible, our core strategy is to strengthen and expand our proprietary brands.
Even when operations are outsourced, we remain committed to upholding the spirit of omotenashi and ensuring consistent quality and value across all our facilities.
In the past, our facilities mostly operated under management contracts with foreign hotel chains. Today, we’re exploring more diverse business models—including franchise agreements and other strategic collaborations. Our extensive experience with global brands forms a solid foundation for our next phase of growth.
Your company manages a diverse portfolio of real estate assets and segments. How do the individual brands contribute strategically to your overall market positioning?
Our main target audience is leisure travelers—families and couples—not business travelers. Our biggest competitive edge is our diverse hotel portfolio, which allows us to serve a wide range of guest needs.
For example, for multi-generational family trips, a large hot spring resort may be ideal. Meanwhile, couples on a honeymoon might prefer a more luxurious facility offering private hot spring experiences. In essence, our portfolio is structured to cater to every generation and traveler type.
You mentioned moving away from dependence on foreign brands. Would a similar approach apply to OTAs like Agoda, which are known for high booking fees? How are you strengthening direct booking channels and loyalty programs to reduce OTA reliance and related costs?
Since 2020, we’ve worked to promote direct bookings across our hotel group. Admittedly, this area is still developing, and we currently remain heavily dependent on both domestic and international OTAs. As you noted, the commission fees can be high, which is a strong motivation for us to increase our direct bookings.
To achieve this, we need to raise our visibility both domestically and internationally. In Japan, we’ve launched TV commercials and allowed our hotels to be used as filming locations in dramas as part of our promotional efforts.
However, outreach to inbound travelers remains a significant challenge. One current focus is enhancing our digital presence to attract international tourists more effectively through our own channels and improve conversion.
ORIX Hotel Management operates as part of the ORIX Group. What major advantages or synergies does this affiliation provide?
To be candid, governance within the ORIX Group is strict, and there’s significant pressure. That said, being part of such a large and financially strong conglomerate is a major benefit. We have access to ORIX’s capital, and with that comes the responsibility to improve ROI.
Functionally, our direct parent company is ORIX Real Estate, which develops and manages a diverse range of assets including condominiums, office buildings, and hotels. Because hotel operations are part of their portfolio, we can leverage their deep real estate expertise—which is a huge advantage for us.
We view this as a positive cycle. Our close relationship with ORIX Real Estate allows for more effective operations and higher profitability, which in turn boosts returns on their assets, freeing up capital for reinvestment. It’s a sustainable, mutually beneficial loop.
Imagine a local region in Japan with an existing building but lacking the resources or expertise to convert it into a hotel. Could developing an adaptable hotel brand series for local communities be a natural extension of your business model?
Yes, we envision scenarios where local communities lack the expertise or capacity to repurpose buildings into hotels. In such cases, offering an adaptable hotel brand portfolio would be a very natural extension of our current model.
As part of the ORIX Group, our ultimate goal is to enhance return on equity (ROE), and asset-light strategies are key. We’ve already begun offering operational services without owning the underlying property. One model developed by ORIX Real Estate involves building a hotel, selling the property to a third party, and continuing to manage it ourselves. This allows for flexibility and a more adaptable business model.
Our KARAKU, HANAORI, and CROSS HOTEL brands have been especially well received in the post-COVID era. Riding this momentum, we’re further strengthening our business and shifting to an operations-focused model.
To our understanding, ORIX Hotel Management is not yet expanding internationally. Given ORIX Group’s strong global network, do you foresee overseas expansion in the future?
Yes, we do plan to expand overseas in the future. Now that we’ve established a stable base in Japan, international expansion is a natural next step. However, we still have several goals we want to achieve domestically, so our current focus remains on the Japanese market.
Our top priority is expanding the Karaku and Hanaori brands in Japan’s hot spring regions. For example, we currently have no facilities in the Kansai region—our portfolio skips directly from Central Japan to Kyushu.
As for CROSS Hotel, we don’t yet have a presence in Tokyo or Fukuoka. Establishing ourselves in these major cities is a strategic priority. Our overall approach is to correct the imbalance in our domestic portfolio and strengthen brand recognition across Japan.
By solidifying our reputation with inbound tourists and expanding nationwide, we can lay the groundwork for—and capitalize on—future international growth.
Let’s imagine we return for an interview on your final day as president. What goals or dreams would you like to have achieved by then, and what legacy would you hope to leave for the next generation of leadership at ORIX Hotel Management?
When our company was newly established, the COVID-19 pandemic hit. Frankly, there were moments that felt like hell. The journey to where we are now has been incredibly difficult, but also deeply instructive. We gained a tremendous amount of experience during those challenging years.
Now, we’ve finally reached a stage where we can establish foundational marketing strategies. The next step is to scale those strategies to a broader, more impactful level.
As president, my mission for the remainder of my term is to focus on employee education and development. When the time comes to pass the baton, I want to be confident that the next generation is fully prepared to lead the company forward.
How do brands like KARAKU, HANAORI, and CROSS HOTEL contribute to your overall market positioning?
As of March 2025, ORIX Hotel Management operates 29 properties (including meeting/training facilities).
We offer a wide range of room categories—from luxury to lifestyle to casual—to match various guest needs and lifestyles. We also operate a variety of property types, from hotels to onsen resorts, offering accommodations suited for tourism, relaxation, and more.
This diversity supports a multi-faceted business approach that avoids targeting a narrow customer segment and allows us to serve a wide range of guests. From a management perspective, it also plays a key role in risk diversification.
What is your sustainability philosophy, and what concrete initiatives are being implemented across your facilities?
We believe that environmentally conscious operations are a corporate duty in the pursuit of a sustainable society. Continuing business at the cost of the environment is no longer an option. With this as our foundation, we don’t view ESG initiatives as “special efforts,” but as responsibilities we are naturally expected to fulfill.
As part of the ORIX Group, ORIX Hotel Management interacts directly with customers. We believe that sustainability initiatives from this customer-facing position can resonate with guests and enhance our value.
In April 2025, we defined five key sustainability themes and began intensifying efforts to address social issues. Specific measures include EV charging stations at our properties, switching to renewable energy sources, reducing plastic use, minimizing food waste, and offering sustainable seafood.
In March 2024, we launched the “Tsunagu-Hagukumu Tourism” project, involving all 21 directly operated inns, hotels, and training facilities under our ORIX HOTELS & RESORTS brand. It aligns with SDGs closely linked to tourism, such as:
Through special packages and exhibitions, we aim to offer guests enjoyable, memorable experiences that not only stay with them but also inspire positive behavioral change in their everyday lives.
As a hospitality provider, we strive to offer both safe, comfortable spaces and contribute to the creation of a sustainable society—empowering each guest to reflect on a better future through their stay with us.
To read more about ORIX Hotel Management, check out this article about them.
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