JAL to sell off hotel arm to Okura group

31 May 2010

Cash-strapped Japan Airlines is to sell off its hotel management arm to the Tokyo-based Hotel Okura group, according to unconfirmed reports in the Japanese media.

JAL Hotels operates 41 hotels in Japan, 28 of which are under the Nikko Hotels International (NHI) brand and 13 of which belong to the Hotel JAL City chain. NHI also has 17 overseas properties, in locations across Asia as well as the Middle East and London. This represents an inventory of nearly 19,000 rooms worldwide.

A JAL statement issued after the news broke said: "JAL apologizes for any inconvenience or concerns caused by the media reports about JAL Hotels. The company did not make any announcement about this issue, and the business of JAL Hotel (Hotel Nikko, JAL City hotels) will continue."

Nikko has recently been targeting China for international expansion. Two hotels are scheduled for Suzhou, the first in October this year the second in 2012, and there are plans to open in four more cities; Shanghai, Wuxi, Guangzhou and Xiamen before 2012.

Hotel Okura is said to be considering changing the hotel brand name from JAL Hotels to Hotel Okura.

The group also has Okura-branded properties in Amsterdam and Shanghai as well as two Korean properties, the Shilla Seoul and Shilla Jeju. It also manages one hotel in the US, a resort property in Hawaii.

Okura is planning to open new hotels in Macau (2011), Taipei (2012) and Bangkok (2012).

Kenny Coyle

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