Accounting & Transactions Series: Road to the 2020 Olympics Macro trends and inbound impact in Japan

Transcription

1 Accounting & Transactions Series: Road to the 2020 Olympics Macro trends and inbound impact in Japan

2 Agenda Section I. Section II. Section III. Introduction the 2020 Olympics in Tokyo Inbound Impact on the Hospitality Sector Inbound Impact on the Aviation Sector 2

3 Section I Introduction the 2020 Olympics in Tokyo 3

4 Historical Investment Prospect Rankings Source: Emerging Trends in Real Estate Asia Pacific 2016, and Urban Land Institute Note: - = no data. 4

5 Analysis of the Japan investment market Pros Abenomics JP Yen depreciation Increasing rent Surging Chinese visitors Strong demand Ultra low finance cost Wide spread Alternative investment by pension funds Cons Shortage of opportunity So much competition Compressing cap rate Higher construction cost Consumption tax hike in 2017 Source: Emerging Trends in Real Estate Asia Pacific 2016, and Urban Land Institute 5

6 The 2020 Olympics in Tokyo Source: The Tokyo Organising Committee of the Olympic and Paralympic Games 6

7 The 2020 Olympics in Tokyo: 2 Zones Source: The Tokyo Organising Committee of the Olympic and Paralympic Games 7

8 Redevelopment in the Tokyo Bay-side Area Source: The Tokyo Organising Committee of the Olympic and Paralympic Games Source: Google Map 8

9 Redevelopment around Marunouchi&Otemachi Source: HP of the Council for Area Development and Management of Otemachi, Marunouchi,and Yurakucho Source: Mitsubishi Estate Co., Ltd. 9

10 Redevelopment around Marunouchi & Nihonbashi Source: Mitsui Fudosan Co., Ltd. Source: Japan Post Co., Ltd 10

11 Railway and Influstructure Source: Ministry of Land, Infrastructure, Transport and Tourism 11

12 Railway and Influstructure: Liner Chuo Shinkansen Source: Yamanashi Prefecture Source: Alliance for promotion of Linear Chuo Shinkansen Line 12

13 Section II Inbound Impact on the Hospitality Sector 13

14 2-1 Overview of inbound visitors to Japan Remarkable Inbound Headlines Fosun Group acquired Hoshino Resort Tomamu for JPY 18.3 billion Amanresort opened Aman Tokyo in Otemachi Spring Airlines will start international flight including Narita- Chongqing Line from February Source: Nikkei Inc. 14

15 2-1 Overview of inbound visitors to Japan Increasing inbound visitors 25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 Nov-Dec (forecast) Jan-Oct (actual) Other Africa South America Oceania Europe North America Asia (Forecast) Source: Japan National Tourism Organization 15

16 2-1 Overview of inbound visitors to Japan Inbound visitors home countries for % 21% 2% 5% 7% 20% Taiwan South Korea China Hong Kong US Thailand Australia Other countries 7% 18% Source: Japan National Tourism Organization 16

17 2-1 Overview of inbound visitors to Japan Characteristics of inbound visitors for 2014 Age Purpose 10% 11% 7% 12% 15% 20% under 20 years old 20's 30's 40's 50's Sightseeing Business Other 20% over 60 years old 24% 81% Source: Ministry of Justice Source: Japan National Tourism Organization 17

18 Accumulated headcount 2-1 Overview of inbound visitors to Japan Most popular places to stay for inbound visitors for ,000,000 Inbound lodgers 12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 Hokkaido Tohoku Tokyo Kanto excluding Source: Japan Tourism Agency Tokyo Chubu Kansai Chugoku Shikoku Kyushu Okinawa 18

19 Number of rooms in hotels 2-2 Hotel supply in major cities Number of hotel rooms in major tourist areas 100,000 80,000 60,000 40,000 Tokyo Hokkaido Osaka Fukuoka Okinawa Kyoto 20,000 0 Source: Japan Tourism Agency Source: Report for Public Health Administration, Ministry of Health, Labour and Welfare 19

20 number of rooms 2-2 Hotel supply in major cities Plans for new and additional rooms in major tourist areas not determined on and after Tokyo Kinki (Kansai) Osaka Kyoto Source: Weekly Hotel Restaurant Dec. 5, 2014, Ota Publications 20

21 ADR (JPY) Occupancy (%) 2-3 Hotel market in major tourist areas Performance of hotels in major tourist areas ADR and Occupancy Ratio 14, % 12, % 80.0% 10,000 8,000 6,000 4, % 60.0% 50.0% 40.0% 30.0% ADR (Tokyo) ADR (Kyoto) ADR (Osaka) Occupancy (Tokyo) Occupancy (Kyoto) Occupancy (Osaka) 2, % 10.0% % Source: Weekly Hotel Restaurant Nov. 13, 2015, Ota Publications 21

22 Sales index 2-3 Hotel market in major tourist areas Performance of hotels in major tourist areas 1.15 Sales index Tokyo Japan Kinki (Kansai) Source: Weekly Hotel Restaurant Nov. 6, 2015, Ota Publications 22

23 2-3 Hotel market in major tourist areas Source: Emerging Trends in Real Estate Asia Pacific 2016, and Urban Land Institute 23

24 Headcount 2-4 Hotel market in London Inbound visitors to London in the years prior to and after the 2012 Olympics 20,000,000 18,000,000 16,000,000 14,000,000 12,000,000 10,000,000 8,000,000 Number of visitors 6,000,000 4,000,000 2,000, (Olympic Year) Source: Visit Britain 24

25 ADR ( ) Occupancy (%) 2-4 Hotel market in London Performance of hotels in London in the years prior to and after the 2012 Olympics % % % % ADR ( ) Occupancy (%) % (Olympic Year) (Forecast) 0% Source: UK Hotels Forecast 2015, UK 25

26 2-5 Large Hotel Deals in Okinawa Marriott Resort & Spa Buyer: Japan Hotel Resort Investment Corporation Seller: SPC of Multinational Investment Funds Sale Price: JPY 14.9 Billion Guest Rooms: 361 rooms Source: HP of YAMBARU TRAVEL NAVI Source: HP of Okinawa Marriott Resort & Spa 26

27 2-5 Large Hotel Deals in RIHGA Royal Hotel Kyoto Buyer: SPC of Fortress Investment Seller: The Royal Hotel Limited Sale Price: JPY 10.4 Billion Guest Rooms: 482 rooms RIHGA Royal Hotel Kyoto Kyoto Station Source: HP of Rurubu Travel Source: HP of Nippon Agency Co., Ltd. 27

28 2-5 Large Hotel Deals in Tokyo Bay Maihama Hotel Club Resort Buyer: Hulic Co., Ltd Seller: Maihama Elite Partners Estimated Sale Price: over JPY 30 Billion Guest Rooms: 703 rooms Source: HP of Rakuten, Inc. Source: HP of Tokyo Bay Maihama Hotel Club Resort 28

29 2-5 Large Hotel Deals in Best Western Shinjuku Astina Hotel Tokyo Buyer: Ascott Residence Trust Seller: Oumi Estimated Sale Price: over JPY 8 Billion Guest Rooms: 206 rooms Source: HP of Jalan Source: HP of Citadines Central Shinjuku Tokyo 29

30 Section III Inbound Impact on the Aviation Sector 30

31 Location 3-1 Airport Concessions have started in Japan Sendai Airport Natori City, Miyagi Pref. # of Passengers (# of international passengers) *1 3,240 thousand (167 thousand) # of Landing (# of international flights landing) *1 27,795 (805) Operational Start July 2001 Access Basic Information of Sendai Airport 17~25 min to Sendai Station by Rail Runway 1,200m and 3,000m Sendai Airport Concession Project Concession Period Up to 65 years (30 year contract period with an option for a 30 year extension) Scope of Work Operation of airport basic facilities such as runways and setting and collecting landing fees Operation of aerodromes and air navigation facilities Environmental measures Operation of both passenger and cargo terminal buildings as well as parking lots Concession Fee Concession payments Purchase cost of terminal and cargo buildings 31

32 3-2 Second largest airport has been formed through the privatization - New Kansai International Airport Corporation Basic Information of New Kansai International Airport Kansai International Airport (KIX) Osaka International Airport (ITM) Location # of Passengers(# of international passengers) *1 # of Landing(# of international flights landing) *1 Izumisano city, Osaka Pref. 19,932 thousand (13,407 thousand) Tokyonaka city, Osaka Pref. 14,621 thousand (o) 72,528(47,641) 69,589(0) Operational Start September, 1994 October, 1951 Access 50~65 min to Osaka station by bus or rail 30 min to Osaka station by bus or rail Runway 3,500m and 4,000m 3,000m and 1,828m Remarks 24 hour operation Kansai International Airport New Kansai International Airport Concession Project Concession Period 45 years Scope of Work Concession Fee Operation of airport basic facilities and terminal building of both KIX and ITM Refueling facility and tail facility of KIX At least 2.2 trillion in fees which include a fixed payment in installments, performance-based payments, purchase price of assets and shares, etc. Itami Airport 32

33 3-3 Overview of the Aviation Market in Japan The number of passengers & flights have been increasing over the last several years No. of passengers (millions) 250 Number of Passengers (Domestic and International) No. of flights (thousands) 1,200 Number of flights (Domestic and International) 200 1, Domestic International 国内線旅客数 Passengers 国際線旅客数 Passengers Domestic International 国内線着陸数 Aviation 国際線着陸数 Aviation Source: Ministry of Land, Infrastructure & Transportation 33

34 (Seat Capacity) Millions Seat Capacity (Millions) 3-4 Overview of the Aviation Market in Japan Market Share by Airline (Seat Capacity, One Way), 2003 to ANA Group JAL Group Other ANA and JAL, two domestic airlines, hold half of the aviation market share Japan Market Share by Airline Type, 2005 to 2014 FSC LCC 2% 2% 10% 13% 3% 5% 8% 3% 7% 4% The market share for Japanese LCCs (Low Cost Carriers Career) remains low while share and FSA (Full Service Aviation) continue to dominate the industry. 34

35 3-5 Overview of Airports in Japan Number of passengers at the Top 20 airports # of Passengers(million) Ration of % change from Airport Domest Interna Internation prev ious Total ic tional al y ear's # of 1 Haneda % 1 06% 2 Narita % 1 01% 3 Fukuoka % 104% 4 New Chitose % 103% 5 Kansai % 1 09% 6 Naha % 108% 7 Osaka % 1 05% 8 Chubu % 1 02% 9 Kagoshima % 1 02% 10 Sendai % 1 04% 11 Kumamoto % 1 03% 12 Nagasaki % 1 05% 13 Miy azaki % 1 01% 14 Matsuy ama % 111% 15 Hiroshima % 1 02% 16 Kobe % 1 08% 17 Ishigaki % 1 1 2% Source: 18 Ministry Komatsu of Land, Infrastructure 2.3 & Transportation % 1 02% (million) Haneda Narita Fukuoka New Chitose Kansai Naha Osaka Chubu Kagoshima Sendai Kumamoto Nagasaki Miyazaki Matsuyama Hiroshima Kobe Ishigaki Komatsu Domestic International Haneda is the giant amongst Japan s airports 35

36 3-6 Population Trend Japan s population from 1950 to 2060 forecast by generation 140, , , over 65 to to 64 under 20 80,000 60,000 40,000 20, Source: Cabinet Office, Government of Japan Japan s population has just passed its peak 36

37 3-7 Overview of inbound visitors to Japan Inbound visitors by countries (2014) Rank Country Volume 1 France 83,700 2 USA 74,757 3 Spain 64,995 4 China 55,652 5 Italy 48,576 6 Turkey 39,811 7 Germany 33,005 8 UK 32,613 9 Russia 29, Mexico 29, Hong Kong 27, Malaysia 27, Austria 25, Thailand 24, Greece 22, Canada 16, Poland 16, Saudi Arabia 15, Macau 14, South Korea 14, Netherlands 13, Japan 13, Ukraina 12, Hungary 12, Shingapore 11, Croatia 11, Sweden 10, Chech Republic 10, Morocco 10, U.A.E. 9,990 France USA Spain China Italy Turkey Germany UK Russia Mexico Hong Kong Malaysia Austria Thailand Greece Canada Poland Saudi Arabia Macau South Korea Netherlands Japan Ukraina Hungary Shingapore Croatia Sweden Chech Republic Morocco U.A.E. Source: Japan Tourism Agency 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 Japan ranked 22nd in the world and 7th in Asia (below Korea) in Considering the size of the economy and the existing resources for tourism, there is a great potential for growth. 37

38 3-8 Overview of Airports in Japan Number of Inbound Tourists at the Top 20 Airports # of International passengers Ratio of Foreigners Japanese Total Foreigners Narita 4,931,533 7,113,257 12,148,567 41% Kansai Intl. 3,170,442 3,248,983 6,422,742 49% Haneda 1,751,967 3,453,605 5,214,434 34% Fukuoka 884, ,743 1,732,667 51% Chubu (Centrea) 699,153 1,441,015 2,140,618 33% Shin-Chitose 661, , ,040 84% Naha 652,948 66, ,857 89% Hakodate 79,510 2,605 82,116 97% Fuji-san (Shizuoka) 72,681 28, ,400 72% Asahikawa 70,380 2,573 72,953 96% Komatsu 54,401 35,246 89,647 61% Hiroshima 54,234 89, ,392 38% Kagoshima 50,215 18,193 68,418 73% Ibaraki 40,170 14,421 54,591 74% Takamatsu 33,923 22,775 56,702 60% Toyama 33,252 17,946 51,199 65% Sendai 27,497 57,304 84,825 32% Nagasaki 27,275 4,447 31,750 86% Saga 27,107 10,812 37,921 71% Source: Ministry of Justice Narita Kansai Intl. Haneda Fukuoka Chubu (Centrea) Shin-Chitose Naha Hakodate Fuji-san (Shizuoka) Asahikawa Komatsu Hiroshima Kagoshima Ibaraki Takamatsu Toyama Sendai Nagasaki Saga Foreigners Japanese - 5,000,000 10,000,000 Which areas are the really attractive for foreign tourists? 38

39 Kyushu Okinawa Naha 3-9 Concession Business has just begun Airports under process Nagasaki Fukuoka Saga Kagoshima First group of airports to be privatised Second group of airports to be privatised May be privatised but at a later date Potentially be privatised Prefecture-owned airports interested in being privatised Kumamoto Kita Kyushu Source: Japan PPP&Infrastructure Matsuyama Oita Hiroshima Miyazaki Kochi Okayama Takamatsu Shikoku Osaka Komatsu Kobe New Kansai JAPAN Honshu Chubu Hokkaido Aomori Akita Haneda Shizuoka Sapporo Hakodate Narita Tokyo Sendai Asahikawa Shin-Chitose 98 airports in total in Japan. The policy has changed from having airports be established everywhere to locations of airports being selected based on social efficiency and the industry being privatised., 39

40 Appendix 1 Continue the conversation Presenter CVs 40

41 Presenter CVs Takeshi Nagashima Partner / Deals FS TEL: [Photo here] i. takeshi.t.nagashima@jp.pwc.com 41

42 Presenter CVs [Photo here] Atsushi Sugihara Director / PPP & Infrastructure Team TEL: atsushi.a.sugihara@jp.pwc.com 42

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