AXA IM Alts, an alternative investment manager, has acquired a prime hotel in Kyoto, Japan, for 6.8 billion yen (US$44.97 million).

The firm intends to leverage its asset management expertise to reposition the property to further enhance its specifications, amenities and sustainability credentials, while rebranding it as a well-known international brand.

The hotel is targeted for completion by early 2025 as Holiday Inn Gojo, under the management by IHG Hotels & Resorts. It will comprise 183 guest rooms across 13 floors. It will feature dining and leisure amenities including a café bar, high-end restaurant, state-of-the-art gym, traditional Japanese bathhouse, and conference facilities.

The 183-room Holiday Inn Gojo is targeted for completion by early 2025.

The renovation work will focus on improving the building’s energy efficiency, including through the installation of energy-saving showers, guestroom management systems and new hotel equipment and amenities.

AXA IM Alts will target the inclusion of a green lease clause in its property management contract and a BELS certification based on an assessment of the building’s energy conservation.

The acquisition aligns with the firm’s objective to continue to scale its portfolio in Japan, a key regional market for 2024, having completed several real estate equity transactions last year.  These included the acquisition of a 33-asset multifamily portfolio located across Tokyo, Greater Osaka and Nagoya and investments into the assisted living and senior housing sector, alongside the strategic disposal of Nakano Central Park East, a 40,000-square-metre office tower.

Laurent Jacquemin, head of Asia-Pacific at AXA IM Alts, comments: “The fallout from the Covid-19 pandemic provided a compelling entry point for new acquisitions in certain pockets of the hospitality sector. The sector’s favourable structural drivers, including an increase in domestic and international tourism, underpin this highly attractive investment. We have a long track record of successfully executing value-add projects as we look to reposition this sizeable, well-located hotel in a market characterized by a scarcity of foreign-brand hotels.”

AXA IM Alts has €183 billion (US$199 billion) of assets under management, comprising €84 billion of primarily private real estate, €88 billion of private debt and alternative credit, and €11 billion in infrastructure and private equity.