Development of an Urban Hotel Business for Inbound Visitors

「During the fiscal year, revenue and profit increased year on year as 3 new hotels opened as planned and 2 hotels joined our Group through M&A.」

「As of the end of October 2025, we operated 32 hotel properties with 3,649 rooms. Amid steady domestic travel spending supported by expanding inbound demand and the Osaka-Kansai Expo, continued increases in room occupancy rates and average room rates under our high-value-added strategy resulted in significant year-on-year increases in both revenue and profit. During the fiscal year, STITCH HOTEL Kyoto opened in Kyoto Kawaramachi in June, Tabino Hotel Kakogawa Befu Station in September, and Tabino Hotel Ishikari in October, all as planned. In August, Nagano Linden Plaza Hotel joined our Group through M&A.」

「At the end of the fiscal year, we operated 28 hotels with 3,144 rooms. In addition to expanding inbound demand, continued increases in occupancy rates and average room rates under our high-value-added strategy resulted in significant year-on-year increases in both revenue and profit. In April 2025, Hiyori Hotel Osaka Suminoe-koen Station opened following rebranding as the third Hiyori Hotel property.」

「During the fiscal year, we operated 28 hotels with 3,144 rooms. In addition to expanding inbound demand, continued increases in occupancy rates and average room rates under our high-value-added strategy resulted in significant year-on-year increases in both revenue and profit. In July, Oriental Hills Okinawa joined our Group through M&A, and in September Hiyori Stay Kyoto Kamogawa opened as planned and will contribute to future results.」

「In addition to funds recovered through hotel sales, we will use funds raised through the issuance of convertible bonds, for which payment was completed on 6 October 2023, to reinvest in hotel development, including M&A, centered on the Tabino Hotel brand and condominium hotels for sale, and expand the business. At present, 10 hotels with 1,355 rooms are planned across Japan, and together with the hotels currently in operation, the total is expected to reach 39 hotels with 4,464 rooms. ② In the hotel operations business, we currently operate a total of 29 hotels with 3,109 rooms. During the quarter, Shofutei, an 11-room ryokan overlooking Mount Bandai, joined our Group in November. In December, Sky Heart Hotel Narita, operated by our Group, underwent major renovations and reopened under the new name Tabino Hotel EXpress Narita. In addition, in January, 5 hotels with 612 rooms in the Kansai area, including Joytel Hotel Namba Dotonbori, joined our Group through M&A.」

「In the hotel development business, revenue and profit increased significantly due to the sale of 1 unit in a condominium hotel for sale and 1 hotel. Going forward, in addition to funds recovered through hotel sales, we will use funds raised through the issuance of convertible bonds, for which payment was completed on 6 October 2023, to reinvest in hotel development, including M&A, centered on the Tabino Hotel brand and condominium hotels for sale, and expand the business.」

「In the hotel operations business, we operate a total of 21 hotels with 2,373 rooms nationwide as of 9 August 2023. As a new initiative, we began operating the serviced apartment Tabino Hotel Live Sado in Sado, Niigata Prefecture, on 23 June 2023.」

「② In the hotel operations business, we opened Shijo Kawaramachi Onsen Sora Niwa Terrace Kyoto and Shijo Kawaramachi Onsen Bettei Kamogawa in June 2022. We currently operate a total of 21 hotels with 2,477 rooms.」

「As a result, revenue for the quarter increased year on year, and we returned to profitability in the third quarter, covering October to December.」

「② In the hotel operations business, we opened Shijo Kawaramachi Onsen Sora Niwa Terrace Kyoto and Shijo Kawaramachi Onsen Bettei Kamogawa in June, and as of 10 November operated a total of 22 hotels with 2,612 rooms.」

「② In the hotel operations business, we opened Shijo Kawaramachi Onsen Sora Niwa Terrace Kyoto and Shijo Kawaramachi Onsen Bettei Kamogawa in June of the fiscal year, bringing the total to 22 hotels with 2,993 rooms.」

「① In the hotel development business, sales of the condominium hotel for sale, HIYORI Ocean Resort Okinawa, progressed, and during the fiscal year deliveries of a cumulative total of 40 units were completed, bringing cumulative sales to 199 of the 203 units.」

「② In the hotel operations business, we opened Tabino Hotel lit Matsumoto in July of the fiscal year and operate a total of 20 hotels with 2,859 rooms.」

「In June of the fiscal year, we opened HIYORI Chapter Kyoto, Tribute Portfolio Hotel, and Tabino Hotel lit Miyakojima, bringing the total to 19 hotels with 2,683 rooms.」

「We opened HIYORI Ocean Resort Okinawa (203 rooms) in February and operate 16 hotels with 2,295 rooms.」

「① In the hotel operations business, we operate 15 hotels with 2,092 rooms. Occupancy rates fell significantly due to the sharp decline in inbound visitors during the COVID-19 pandemic, the closure of visitor facilities, the cancellation of events, and restrictions on travel not only for tourism but also for business trips.」

「① In the hotel operations business, Tabino Hotel Kashima (194 rooms) opened in April 2020, bringing the total to 15 hotels with 2,092 rooms. Although occupancy rates at hotels in areas with strong business demand remained firm at a certain level, the sharp decline in inbound visitors and the closure of tourist facilities forced us to temporarily close 7 hotels, and occupancy rates fell significantly.」

「③ In the hotel development business, the development project for our first condominium hotel for sale, Hiyori Ocean Resort Okinawa (204 units), in Onna Village, Okinawa Prefecture, is progressing smoothly. A total of 140 units from the first through fourth sales phases have been fully registered and sold. We also began the fifth sales phase, covering 8 units, in July. However, in view of the difficult outlook for tourism resulting from the COVID-19 pandemic, we have put initiatives for new hotel development projects on hold.」

「① In the hotel operations business, Tabino Hotel Kurashiki Mizushima (155 rooms) opened in February 2020, and as of the end of March we operated 16 hotels with 2,108 rooms in Japan. Tabino Hotel Kashima (194 rooms) opened in April 2020, bringing the total to 17 hotels with 2,302 rooms. Going forward, we will seek to increase the number of hotels we operate through a range of methods, including developing, owning and operating hotels ourselves, acting as operator under long-term leases for hotels owned by external owners, and M&A.」

「① In the hotel operations business, Courtyard by Marriott Osaka Hommachi (193 rooms) opened in October 2019, followed by Hiyori Hotel Tokyo Ginza EAST (135 rooms) in December. As of December, we operated 14 hotels with 1,953 rooms in Japan. Tabino Hotel Kurashiki Mizushima (155 rooms) is scheduled to open in February 2020, bringing the total to 15 hotels with 2,108 rooms. Going forward, we seek to increase the number of hotels we operate through a range of methods, including developing, owning and operating hotels ourselves, entering into long-term leases for hotels developed and owned by external owners, and M&A.」

「① In the hotel operations business, as of September we operated 12 hotels with 1,625 rooms in Japan. Courtyard by Marriott Osaka Hommachi (193 rooms) opened on 1 October, bringing the total as of October to 13 hotels with 1,818 rooms. Going forward, we seek to increase the number of hotels we operate through a range of methods, including developing, owning and operating hotels ourselves, entering into long-term leases for hotels developed and owned by external owners, and M&A.」

「① In the hotel operations business, we operate 12 hotels with 1,625 rooms in Japan. Going forward, we seek to increase the number of hotels we operate through a range of methods, including developing, owning and operating hotels ourselves, entering into long-term leases for hotels developed and owned by external owners, and M&A.」

「As of 31 March 2019, our Group operated 10 hotels with 1,191 rooms in Japan. As part of our future expansion, we plan to open 5 new hotels with a total of 897 rooms: Osaka Namba in May 2019, Osaka Hommachi in October, Higashi-Ginza in December, Kurashiki Mizushima in February 2020 and Kashima in March 2020. In addition, we are seeking to increase the number of hotels we operate through a range of methods, including M&A, developing, owning and operating hotels ourselves, and entering into long-term leases for hotels developed and owned by external owners.」

「In recognition of the service provided by our warm-hearted employees as we work toward realizing the theme of our hotel operations business, “warm-hearted hotels,” our own brand, Hiyori Hotel Maihama, ranked No. 1 nationwide in the 2018 annual customer-review ranking for the casual hotel category published by OZmall, a website for women. As of 31 December 2018, our Group operated 10 hotels with 1,191 rooms in Japan, and plans to open new hotels in Osaka Namba, Osaka Hommachi and Higashi-Ginza in 2019. In addition, on 30 November 2018, we began construction of our first condominium hotel for sale, Hiyori Ocean Resort Okinawa, in Onna Village, Okinawa Prefecture, and will begin accepting registrations for the first phase on 16 February 2019.」

「In June 2018, VIP NANGO in Shimonoseki, Yamaguchi Prefecture (now Sky Heart Hotel Shimonoseki) joined our Group, bringing the number of Sky Heart Hotel locations to 5. In addition, on 2 May 2018, we opened Tabino Hotel Hida Takayama in Hida-Takayama, Gifu Prefecture, a wood-built hotel making extensive use of locally sourced timber, as the first property under Tabino Hotel, the casual brand of our own Hiyori Hotels & Resorts brand. On 20 July of the same year, we opened Tabino Hotel Sado on Sado Island, Niigata Prefecture, as the second property, featuring bamboo, a local specialty, as its design motif. As of 30 September 2018, we operated 10 hotels with 1,191 rooms in Japan.」

「The group has also begun construction on projects in the Ginza-Higashi, Osaka-Hommachi, Osaka-Namba and Kyoto-Shijokawaramachi areas. In addition, it plans to increase the number of operating hotels through a range of approaches, including M&A, models in which the group develops, owns and operates hotels itself, and models in which the group enters into long-term leases for hotels developed by external landowners.」

「The group also newly developed Tabino Hotel (TABINOHOTEL) as a casual brand under its own Hiyori Hotels & Resorts brand. Tabino Hotel is a regional revitalization hotel brand that focuses on areas of Japan rich in cultural, historical and natural attractions, uncovering the distinctive appeal and characteristics of each region.」

「The group also newly developed Tabino Hotel (TABINO HOTEL) as a casual brand under its own Hiyori Hotels & Resorts brand. Tabino Hotel is a regional revitalization hotel brand that focuses on areas of Japan rich in cultural, historical and natural attractions, uncovering the distinctive appeal and characteristics of each region. As its first property, the group opened Tabino Hotel Hida-Takayama in Gifu Prefecture in April this year, a timber-built hotel making extensive use of locally sourced wood. As its second property, it plans to open Tabino Hotel Sado on Sado Island in Niigata Prefecture in July this year, featuring traditional bamboo craftsmanship as its design motif.」

「The group also held the grand opening in July this year of Hiyori Hotel Maihama, the first hotel under its own brand that it newly developed and operates. With “Warm-hearted hotels” as its brand policy, the group aims to create a hotel brand that continually improves and evolves through the efforts of employees working from the customer's perspective. The group has begun construction on projects in Takayama, Sado and Ginza-Higashi, and aims to begin construction on the Osaka-Hommachi project by the end of the year. In addition, hotel operating plans are advancing in areas including Osaka-Namba and Kyoto-Shijokawaramachi under models in which the group develops and operates the hotels itself or enters into long-term leases for hotels developed by external landowners in line with the group's intentions.」

「At Spring Sunny Hotel Nagoya Tokoname, focusing on developing new distribution channels in addition to Chinese group tours led to further improvements in occupancy and average room rates, and performance continues to expand steadily. The group's first newly developed and operated hotel under its own brand, Hiyori Hotel Maihama, held its grand opening in July this year. With “Warm-hearted hotels” as its brand policy, the group aims to create a hotel brand that continually improves and evolves through the efforts of employees working from the customer's perspective. Going forward, in addition to operating hotels developed by the group in areas including Hida-Takayama, Osaka-Hommachi, Kyoto-Shijokawaramachi, Ginza-Higashi and Narita Airport, operating plans are also advancing under a model in which the group enters into long-term leases for hotels developed by external landowners in line with the group's intentions.」

「The first jointly branded hotel with the Spring Airlines China Group, Spring Sunny Hotel Nagoya Tokoname, was created through the group's revitalization of an existing hotel. Its occupancy rate improved significantly after operations began, and its average room rate also increased. In December last year, the group acquired the shares of Sky Court Hotel Co., Ltd., which operates 4 hotels with 564 rooms mainly in the Tokyo metropolitan area, bringing it into the group. In April this year, the group opened its first hotel under its own brand, Hiyori Hotel Maihama, which it newly developed and operates.」

「In December last year, the group acquired the shares of Sky Court Hotel Co., Ltd., which operates 4 hotels with 564 rooms, mainly in the Tokyo metropolitan area, bringing it into the group. In late April this year, the group planned to open its first hotel developed under its own brand in Maihama. It is also advancing the rollout of additional hotels in areas including Hida-Takayama, Ginza-Higashi, Narita Airport, Osaka-Hommachi and Kyoto-Shijokawaramachi, either under its own brand or jointly branded.」

「The first jointly branded hotel with the Spring Airlines China Group, Spring Sunny Hotel Nagoya Tokoname, held its grand opening in April in Tokoname, Aichi Prefecture. It was developed through the group's revitalization of an existing hotel. Since the group began operating it, occupancy has improved significantly and remained above 96%, while average room rates have increased. In addition to the upper-grade hotel planned in Kyoto, the group is advancing the development and operation of its own urban tourist hotel brands for inbound travelers across multiple categories suited to guests' purposes.」

「The first hotel under the jointly branded Spring Sunny banner opened with a grand opening in April this year in Tokoname, Aichi Prefecture.」

「The group is developing urban tourist hotels for inbound travelers. It is combining its own strengths in customer-focused real estate revitalization and operations with the Spring Airlines China Group's ability to attract customers and bring travelers to Japan through its travel and aviation businesses. In addition to developing the jointly branded Spring Sunny hotels, the group is also planning its own hotel brand for the upper-middle segment in central Tokyo.」