Thank you for your support and patronage to Japan Hotel REIT Investment Corporation (JHR) and its asset management company, Japan Hotel REIT Advisors Co., Ltd.

Having settled the accounts for JHR's 25th fiscal period (from January 1, 2024 to December 31, 2024), we are pleased to report the management status and performance results for the period.

The hotel market in 2024 remained strong. Domestic and international leisure demand was robust throughout the year, with stable domestic demand and particularly strong inbound demand. The annual number of inbound visitors reached approximately 37 million, surpassing the pre-pandemic level of 2019 by 15.6%. Among these, travelers from the US, Europe and Australia, who tend to stay longer and spend more, showed significant growth, providing a favorable boost for JHR.

Under such market conditions, JHR conducted a public offering in 2024 and subsequently acquired four properties: MIMARU Tokyo Shinjuku West, HOTEL AMANEK Shinjuku-Kabukicho., OKINAWA HARBORVIEW HOTEL and Southern Beach Hotel & Resort OKINAWA, with a total acquisition price of 56.2 billion yen. As a result, JHR’s portfolio reached 51 properties with a total asset size of 453.1 billion yen based on acquisition price as of the end of December 2024.

For its internal growth, we continued to closely communicate with hotel lessees and operators to enhance profitability. By leveraging room renovations to increase room rates, implementing effective marketing strategies, and maintaining precise revenue management, we successfully captured high-priced domestic and international leisure demand, resulting in a year-on-year increase of 16.9% in accommodation revenues. The revenues in the food and beverage department also rose by 17.2%, leading to total revenue growth of 15.7%. Furthermore, we continued to implement cost reduction measures, improving the profit margin (Note).
(Note) The figure for revenues refer to the data for the 28 hotels with variable rent, etc.

As a result of these efforts, for the fiscal year ended December 2024, JHR recorded operating revenue of 33,481 million yen, ordinary income of 18,273 million yen, net income of 18,272 million yen, and dividend per unit of 3,937 yen.

JHR believes that the growth trend in the hotel market will continue in 2025, driven by steady domestic demand and robust inbound demand. We will continue to proactively capture demand and aim to maximize revenue.

Together with Japan Hotel REIT Advisors Co., Ltd., JHR is dedicated to further growth and enhancing its attractiveness by leveraging its extensive expertise and know-how cultivated to date.
We sincerely appreciate your continued support for us.