Numerous Hotels in Japan Fell Into Crisis Because of Covid-19

The Osaka Corona Hotel is unusually quiet for the past few weeks.

Before the Covid-19 raging, Japan witnessed a boom in hotel construction and once raised concerns about the sustainability of the market. Kohei Fujii, the retail manager of Corona Hotel in Osaka, said they have noticed a large number of rooms being launched in the past few years. He predicted that many places would be difficult to exist.

Between 2015 and 2018 alone, Osaka added 21,000 new hotel rooms. Currently, many of these are vacant. One of them is the Corona Hotel. Kohei Fujii sighed as she sat in the empty cafe in the lobby. On the front desk is a beer bottle with a price notification but no customers.

Spring is always the busiest hotel season, Fujii said. Companies continually rent conference rooms and banquet halls to host seminars, trainings, and welcome new employees.

But when Covid-19 broke out, travel was restricted and businesses shut down, the number of bookings dropped to one-third from the same period last year. Another hotel experiencing the same situation is Vista Osaka Namba. Hisao Ikawa opened a 121-room hotel in February, the same day Japan encouraged schools to close across the country. Sitting in front of a giant mural depicting a golden tiger in the empty hotel lobby, Ikawa said that at this time Japan has almost no bright spot in attracting tourists.

In the ancient capital of Kyoto, a drop in international tourists is threatening the survival of many traditional inns, or small inns run by households.

Momoka Matsui is the fourth generation to run a family inn near the famous Nishiki Market. She said she recently received a lot of cancellation calls at a time when her inn should have been the most crowded – spring, cherry blossom season. Very few of her bookings can charge a cancellation fee. If this happens during the summer, the owner doesn’t know how to maintain the business. Her business has 100 employees, and many of them are being asked to stay home and receive government benefits, with two-thirds of their food.

The Kyoto Hotel Association, which represents more than 200 mid-sized hotels across the country, said it expects more bankruptcies this year if the disease continues to occur throughout the summer and the government does not rescue them.