Japan's Hotel Performance Post Quake

Data from STR Global, a leading provider of market data to the world's hotel industry, shows that hotels in Sendai, the city nearest the Japan's recent earthquake epicentre, Sapporo and Tokyo have borne the brunt of the impact of the disaster from an industry perspective. Cities further from the centre of the catastrophe have been impacted less.

Occupancy in Japan was down 21.3% for March 2011 and 27.6% for April 2011 compared with the same months in 2010. Tokyo and Sendai showed greater falls in occupancy of 33.6% and 36.7% for March, respectively, compared to the nationwide occupancy decrease.

Sendai's RevPAR declined 22.7% in March 2011 before increasing by 77.2% in April 2011. Demand is expected to remain firm with, firstly, the resumption of the normal operation of the Tohoku Shinkansen express train helping volunteers, relief and reconstruction teams get to the affected area and, secondly, with insurance companies sending plenty of staff to the Sendai area to assess claims.

By comparison Tokyo, some 300 kilometres to the south of Sendai, saw occupancies that fell from 83% in March 2010 to 55% in March 2011, as people sought to move away from the believed threat of radiation exposure. Further south, Osaka saw only a small reduction in occupancy (-2.8%) whilst Kobe actually experienced a rise of 6%.

"Our deepest sympathies go to those affected by the dramatic earthquake and tsunami in Japan," said Elizabeth Randall, managing director of STR Global. "Declines in RevPAR are nothing against the overall suffering of the country and the loss of life. With the resilience of the Japanese people, the country and industry will surely recover."

Japanese hotels reacted with composure in the aftermath of the earthquake, tsunami and the related radiation issues from the Fukushima nuclear plant in the Tohoku region of northeastern Honshu. In solidarity with the Japanese people and business communities, the hotel industry has shown admirable commitment to helping those affected by the disaster.

For example, several of Tokyo's three and four-star hotels have made themselves available as public shelters to help cope with the influx of displaced people and those seeking to distance themselves from the possibility of radiation exposure.

The Grand Prince Akasaka, one of the city's most prestigious addresses, was due to close at the end of March, but stayed open to offer accommodation to some of the 30,000-plus evacuees from the Fukushima Prefecture.

Solare Hotels & Resorts, which manages hotels in 73 destinations across the country, offered 10,000 room nights free of charge in its Chisun and Loisir-branded hotels. Additionally, many hotels have waived cancellation fees.

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