Hotel room supply to increase 24% over next three years
Apparent “over-supply” may be offset by regained demand


  • Rapid growth in inbound tourist is spurring the development of new hotels across Japan. A total of 80,000 rooms are expected to be supplied in the nine major cities by 2021, which equates to 24% of existing stock at the close of 2018.
  • An estimate of the number of hotel rooms required in 2021 based on predicted accommodation demand suggests that room stock in the nine major cities will exceed the number of rooms required.
  • The gap between the number of hotel rooms required and the forecast stock varies between cities and are as follows: Osaka 21,000 rooms, Tokyo and Kyoto 12,000 rooms, Nagoya 8,000 rooms, Sendai 4,000 rooms, Sapporo 3,000 rooms, Hiroshima and Naha 2,000 rooms, and Fukuoka 1,000 rooms. But Demand is likely to recover if supply resolves the shortage of rooms.
  • As the number of rooms increases in the coming years, it is unlikely that every class of hotel will benefit from growth in inbound demand. CBRE believes that differentiation will be necessary for hotels to succeed.