As announced by Mitsubishi Estate and Mitsubishi Estate Hotels & Resorts on March 31, 2025, Yokohama Royal Park Hotel (横浜ロイヤルパークホテル) — 603 rooms on floors 52 to 67 of Yokohama Landmark Tower — closed on that date and began a full-scale renovation of the entire property. After the works, the hotel will operate under a franchise agreement with Marriott International and is scheduled to reopen in fiscal 2028 as part of Marriott’s luxury brand, The Luxury Collection, while retaining the trade name “Yokohama Royal Park Hotel.” Roughly 32 years after its 1993 opening, a large city hotel is simultaneously undergoing a full-closure renovation under its own brand and converting to a franchise with a foreign brand, making this one of the larger repositioning projects in Japan. This article reviews the site (MLIT Real Estate Information Library), the room stock and price tiers within a 1.5km radius, and the new supply outlook, then backcasts how far the estimated settled ADR and RevPAR (room revenue per available room = ADR × occupancy) would need to rise for the rooms division alone to recover the renovation investment.

Room stock in this article covers lodging facilities with 10 or more rooms (excluding leisure/love hotels) within a 1,500m radius of Yokohama Landmark Tower. “Operating” means properties for which selling prices were confirmed on major booking sites in the most recent 3 months (August–October 2026) (as of October 27, 2026; compiled by MetroEngines Research).

Summary — The 603 Rooms Are Heading for a Price Tier With No 400+ Room Precedent Nearby

To state the conclusion first: the question in this project is not “Is there luxury demand in Minatomirai?” but “Can a 600-room-class property be filled at luxury price points?” Within a 1.5km radius, only three properties had an average listed price (all plans) above ¥70,000 over the latest 12 months — The Westin Yokohama (373 rooms), InterContinental Yokohama Pier 8 (173 rooms) and The Kahala Hotel & Resort Yokohama (146 rooms) — totaling 692 rooms, or just 5.7% of the 12,090 operating rooms. Meanwhile, the listed prices of city hotels with more than 400 rooms in the radius cluster in the ¥50,000 range, so the combination of “400+ rooms × luxury price tier” does not currently exist in the area. The reopened Yokohama Royal Park Hotel will be the first large-scale project to step into that gap.

The demand-side tailwinds are clear. The estimated settled ADR (area median) in Yokohama’s Nishi Ward averaged ¥20,200 over the latest 12 months, up 12.9% year on year, and Kanagawa’s city hotel segment rose 17.9% — both double-digit growth. In addition, the official land price near Landmark Tower has risen 63.8% over the four years since 2022. However, Conrad Yokohama (272 rooms) is also scheduled to open in 2027, and top-tier room supply is expected to build up substantially before the reopening. In the calculations below, assuming a renovation investment of ¥30 million per room and a 5% target yield, the rooms division alone would need a RevPAR uplift of about ¥9,100 — a level that would be exceeded if the hotel achieves an ADR on par with the top property in the radius.

Announced Facts — Full Closure, Retained Trade Name, Franchise With Marriott

First, let us organize the facts that can be confirmed from the announcement. According to the press release, the hotel occupies floors 52 to 67 of Yokohama Landmark Tower and opened in 1993 as an “international-class city hotel” with 603 rooms, a total floor area of approx. 79,100㎡, one of the largest banquet facilities in Yokohama, and eight food and beverage outlets. The renovation covers guest rooms, restaurants, the spa, gym, club lounge and public areas. Rather than a phased renovation while remaining open, the owner chose to close the entire property and renew it all at once.

What stands out in this structure is the choice of a “franchise”: it leverages the operational capabilities of Mitsubishi Estate Hotels & Resorts, which has run the hotel day to day, while switching only the distribution network and customer base onto the Marriott brand. The release cites Marriott’s loyalty program, Marriott Bonvoy, as having more than approx. 228 million members, signaling an aim to tap inbound and overseas corporate booking channels in one move. In addition, keeping the trade name avoids severing relationships with wedding, banquet and local corporate clients built up in Yokohama over 32 years. It can be described as a design that pursues both a brand upgrade and the hotel’s local customer assets. Note that because the post-reopening room count has not been announced, the calculations in this article provisionally hold it at the pre-closure count of 603 rooms.

Market Trends — Nishi Ward Estimated ADR Up 12.9% YoY on a 12-Month Average

So how has the surrounding market moved over the two years around the closure? The chart below overlays, year by year, the estimated settled ADR (area median) of Yokohama’s Nishi Ward, where the hotel is located. In 2026 it bottomed at ¥15,900 in January and then climbed, reaching ¥23,300 in September — well above ¥17,500 in the same month a year earlier. The average for the latest 12 months (October 2025–September 2026) was ¥20,200, up 12.9% from ¥17,900 in the prior-year period.

Over the same period, Kanagawa’s city hotel segment (median, N=40–42 properties) averaged ¥15,500 over 12 months, up 17.9% year on year, indicating that upper-tier rates are rising across the prefecture as well. Demand is also solid in terms of occupancy. Occupancy for Kanagawa’s city hotel segment (based on OTA listed inventory, estimated) was 88.8% in May 2026, 84.5% in June, 85.5% in July, 86.4% in August and 85.5% in September (28 properties / 5,477 rooms, based on major booking site listings). For Nishi Ward overall, September 2026 was 85.9% (10 properties / 2,284 rooms, based on major booking site listings). Note that these are estimates based on how inventory sold on OTAs is being absorbed, and differ from the actual occupancy of each property as a whole. For a monthly breakdown of recent rate movements at city hotels in the prefecture, see our analysis Kanagawa Sept 2026 Settled ADR: City +15.8% Rebound.

The demand base also continues to expand. According to the City of Yokohama, tourist arrivals (actual persons) in 2025 were 39.15 million and tourism spending was ¥507.7 billion, both record highs since the statistics began in 2009. With rates, occupancy and visitor numbers all trending upward, a large block of rooms is returning to the top tier of the market.

Site Evaluation — Commercial Zone, 800% FAR, a Supertall Within Walking Distance of Stations

Checking the site in the MLIT Real Estate Information Library, the Landmark Tower plot is designated a commercial zone (floor area ratio 800%, building coverage ratio 80%). The nearest official land price benchmark point (Yokohama Nishi 5-6, Minatomirai 3-chome, approx. 190m from the site) stood at ¥3.75 million per ㎡ as of January 1, 2026, up 10.0% year on year. It has risen 63.8% in four years from ¥2.29 million in 2022; annual growth peaked at +19.2% in 2024 and has held at +10.0% for two consecutive years, keeping its pace while trading at elevated levels.

In terms of transport, average daily ridership at Sakuragicho Station (JR Negishi Line) recovered from 99,038 in 2020 to 141,322 in 2023, and Minatomirai Station also rebounded to 82,564. Within a 1km radius there are 5,802 establishments with 161,353 employees, and office-type industries account for 37.2% of them. It is a location that can capture corporate lodging, meeting and banquet demand locally. The resident population (census-based, not daytime/visitor population) within 1.5km is also projected to reach 77,270 in 2040, an increase of 7.1% over 2020.

Disaster risk should also be checked. According to the Real Estate Information Library, the Landmark Tower site is not within the flood (maximum assumed scale), storm surge or tsunami inundation zones. However, tsunami inundation zones (assumed depth of 1m to under 2m, among others) and storm surge inundation zones lie within approx. 100m of the site. While the guest rooms are on high floors, banquet halls and mechanical rooms are generally located on lower or basement levels, so it is worth confirming the layout of electrical and plumbing systems and flood-proofing measures in the renovation plan from a business-continuity perspective. Final judgments should be confirmed against the City of Yokohama’s hazard maps.

Competing Supply — Room Stock Within 1.5km Up 70% Since 2017; 2020s Openings Make Up 30%

Next, let us look at the room stock surrounding the hotel. Within a 1.5km radius there are 77 listed lodging facilities with 15,942 rooms, of which 48 properties with 12,090 rooms were operating (selling prices confirmed in the most recent 3 months). For properties with a confirmed opening year, room stock grew 73.6% from 7,610 rooms in 2017 to 13,209 in 2026, with especially large additions in 2019 (the opening of APA Hotel & Resort Yokohama Bay Tower, 2,311 rooms) and 2023 (Hilton Yokohama, Mitsui Garden Hotel Yokohama Minatomirai Premier and others). Properties opened in the 2020s account for 15 hotels / 3,750 rooms of operating stock, or 31.0% of the radius.

By size, properties with 201 or more rooms account for 22 operating hotels / 9,120 rooms, or 75.4% of operating rooms in the radius — Minatomirai has always been a district whose market is shaped by large hotels. Operating rooms in the city hotel segment total 2,855, and the pre-closure Yokohama Royal Park Hotel’s 603 rooms equate to roughly 20% of that. The reopening will significantly reshape the room mix of the city/luxury tier.

A note on the investment market’s perspective. Several hotels in the radius are owned by J-REITs. According to our ownership master (as of October 19, 2026), Invincible Investment Corporation (8963) owns APA Hotel Yokohama Kannai (451 rooms, acquired February 2015, acquisition price ¥8,350 million), Hotel MyStays Yokohama Kannai (165 rooms, acquired February 2018, ¥5,326 million) and Flexstay Inn Sakuragicho (70 rooms, acquired July 2019, ¥1,425 million). All are limited-service hotels; no large full-service hotel is among the J-REIT-owned properties in the radius.

Positioning — The 400+ Rooms × Listed Price Above ¥70,000 Zone Is Empty

Plotting the main competitors on two axes — room count and price — makes the post-reopening target clear. The chart below shows the city/luxury tier and upper-tier limited-service hotels in the radius, with the listed price (all-plan average, tax-inclusive) over the latest 12 months (October 2025–September 2026) on the vertical axis and room count on the horizontal axis. The pre-closure Yokohama Royal Park Hotel (12-month average, April 2024–March 2025) is shown as a hollow marker for reference.

The upper-right of the chart — “more than 400 rooms and a listed price above ¥70,000” — currently contains not a single property. The three properties listed above ¥70,000 are all mid-sized at 146–373 rooms, while the two with more than 400 rooms, InterContinental Yokohama Grand (ヨコハマグランドインターコンチネンタルホテル, 594 rooms) and Yokohama Bay Hotel Tokyu (480 rooms), sit in the ¥50,000 range. In estimated settled ADR terms, The Westin Yokohama averaged ¥49,000 over the latest 12 months, the highest in the radius among properties for which an estimate can be calculated, while InterContinental Yokohama Grand, Yokohama Bay Hotel Tokyu and Hilton Yokohama line up at an average of ¥31,900. In its last 12 months before closure, Yokohama Royal Park Hotel had an estimated settled ADR of ¥29,900, demonstrating strong drawing power in the core price band of large city hotels thanks to its views and banquet capabilities.

Securing this position matters. Mid-sized luxury hotels, with fewer rooms, find it harder to accommodate international conferences and large groups in a single block. If a property with 600-class room inventory and one of the city’s largest banquet facilities under the same roof moves into the luxury price tier, it can take in the upper layer of MICE demand centered on Pacifico Yokohama — lodging, meetings and dining — as a single package. How many rooms are concentrated around Pacifico Yokohama is measured, alongside other venues, in Rooms Within 1km of 14 Japan MICE Venues.

New Supply — With Conrad Yokohama in 2027, the Top Tier Is Set to Double

Top-tier supply will steadily increase before the reopening. According to Hilton’s company overview (updated August 25, 2026), Conrad Yokohama (272 rooms) is scheduled to open in 2027 in a mixed-use building in Kitanakadori 6-chome, Naka-ku, Yokohama, about a 5-minute walk from JR Sakuragicho Station. MLIT’s Building Construction Dynamics Statistics also records a 40-story residential/hotel mixed-use project including a 272-room hotel in the same Kitanakadori 6-chome (scheduled completion May 2027). The location of Conrad Yokohama and the surrounding price tiers are examined in depth in Conrad Yokohama 272 Rooms: Luxury Tier Above a ¥33,300 ADR Ceiling.

Adding Conrad Yokohama’s 272 rooms and the reopening’s 603 rooms (holding the pre-closure count constant) to the existing three properties’ 692 rooms brings the top tier to 1,567 rooms, about 2.3 times today’s level. When rooms in the same price band double in a short period, an effective approach is a staged one: avoid setting opening rates too high, first build an occupancy base through brand loyalty channels and banquet/wedding packages, and then raise rates. Note that the Building Construction Dynamics Statistics are compiled on a building-confirmation-application basis, and the number of projects and rooms is expected to grow as further applications are filed, so they should be treated as a lower bound of the confirmed pipeline at this point.

Renovation Economics — At ¥30 Million per Room and a 5% Yield, the Required RevPAR Uplift Is About ¥9,100

From here, we backcast the economics that owners, asset managers and lenders most want to know, focusing on the rooms division. Because the total renovation cost has not been disclosed, we set three cases for renovation investment per room — ¥30 million, ¥45 million and ¥60 million — and calculated the RevPAR uplift required to recover that investment from incremental rooms-division profit. The share of incremental room revenue retained as profit is assumed to be 45% after franchise-related costs.

The scenario comparison below sets this required uplift against the rate levels observable in the market. The baseline is a RevPAR of about ¥23,900, derived from the pre-closure 12-month estimated settled ADR of ¥29,900 multiplied by an assumed year-round occupancy of 80%. At the level of the three upper-upscale hotels in the radius (Scenario A), the uplift is only ¥1,600; but if the hotel reaches the level of The Westin Yokohama, the top property in the radius (Scenario B), RevPAR rises to about ¥36,800 and the uplift to about ¥12,800.

The reading is straightforward. If Scenario B materializes, the rooms division alone can justify a renovation investment of approx. ¥42 million per room — roughly ¥25 billion in total — at a 5% yield. At Scenario A levels, the rooms division leaves little room for recovery, and the effect of the brand conversion comes down almost entirely to “whether rates can be lifted to the top tier.” On the other hand, this calculation excludes incremental revenue from banquets, weddings, F&B and the spa. For a large hotel with one of the city’s largest banquet facilities and eight F&B outlets, non-rooms revenue is also substantial, and capturing upper-tier MICE demand would lower the required rooms-division uplift accordingly. Assessing the renovation investment from both the rooms and banquet sides is closer to reality.

Construction Cost Benchmark — A New Build of the Same Size Would Cost About ¥46.8 Billion at the National Average

Comparing with new construction provides a useful yardstick for the renovation investment level. Under MLIT’s Building Construction Starts Statistics (lodging-use, nationwide, all structures), the cost per tsubo (estimated construction cost ÷ floor area) rose from ¥1.203 million in 2019 to ¥1.377 million in 2023, then jumped to ¥1.955 million in 2024. Kanagawa’s 2024 figure of ¥3.241 million far exceeds the national level, but the number of construction starts is small, making it susceptible to individual projects.

Applying the 2024 national average of ¥1.955 million per tsubo to the total floor area of approx. 79,100㎡ (approx. 23,900 tsubo), the construction cost of building a hotel of the same size from scratch would be about ¥46.8 billion, or about ¥77.6 million per room. Luxury specifications inside a supertall mixed-use building normally exceed the average, so the actual cost of a new build would likely be even higher. The renovation investment of ¥30–60 million per room assumed in this article corresponds to roughly 40–80% of this new-build equivalent. Being able to move into the top tier with a smaller investment and shorter construction period than a new build, while leveraging hard-to-replace assets — the existing structure, the views and the banquet halls — is a major advantage of the renovation-plus-rebrand option.

Sensitivity and Risks — Combined ADR −10% and OCC −5pt Cut the Uplift to About ¥7,000

We also check the range of outcomes if the base case (Scenario B) does not proceed as assumed. Given that top-tier rooms will double in a short period, a scenario in which rates and occupancy fall short of expectations immediately after opening should be factored in.

Even if ADR undershoots by 10%, the uplift is about ¥9,200, slightly above the level required for “¥30 million per room at a 5% yield.” If ADR and occupancy undershoot simultaneously, it shrinks to about ¥7,000, and the recoverable investment from the rooms division alone falls to approx. ¥22.8 million per room. In other words, during the first few years after reopening, incremental banquet and F&B revenue and the brand’s loyalty-driven bookings will play the role of supporting the ramp-up of room rates.

Implications for Owners, Asset Managers and Regional Banks With Large Hotels

The implications of this project apply broadly to owners of large city hotels around 30 years old, not just in Yokohama. First, a full closure halts revenue for a time, but in exchange it shortens the construction period and allows the hotel to come to market all at once as a new brand at reopening. Repeated phased renovations tend to prolong a period in which old and new rooms coexist and rates are hard to raise. Second, a franchise — keeping operations within the owner’s group while switching only the brand to a foreign one — is a way to gain an international distribution network without giving up operational know-how and local customer assets. Third, in areas where land prices continue to rise, renovating while leveraging the existing structure tends to be more investment-efficient than rebuilding.

In lending and investment screening, an effective procedure is to derive the required RevPAR uplift from “renovation investment × target yield,” as in this article’s backcast tables, and compare it against the actual performance of the top properties in the area. Whether the required uplift is only reachable at top-of-market rates or attainable even at mid-tier rates makes a big difference to the price risk the plan carries. In addition, knowing the timing and room counts of new supply entering the same price band makes it easier to set assumptions for the ramp-up period after opening.

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