OSAKA -- Six startups in western Japan's Osaka Prefecture are set to launch a project on Thursday to refurbish vacant houses in the city of Osaka's Nishikujo district and operate them as guest rooms catering to tourists as a way to revitalize the local economy and make up for a shortage of hotels.
The Sekai Hotel project is led by Kujira, an Osaka-based company specializing in the renovation of existing homes. In Japanese, the term sekai refers to the world.
Kujira aims to capitalize on the increasing number of foreign travelers to Japan by overhauling the row houses and other vacant homes dotting Nishikujo and offering them as accommodations.
However, Sekai Hotel is not a hotel per se under Japanese law.
Sekai Hotel's facilities are classified as either minpaku -- meaning private home rentals -- which are allowed as a special exception to the hotel business law under the national strategic special zone law, or as "simple accommodations" under the hotel business law.
As part of its economic growth strategy, the Japanese government of Prime Minister Shinzo Abe introduced the national strategic special zone scheme to ease regulations. Some local governments, including the city of Osaka, introduced the special zone minpaku system.
Minpaku is growing in popularity amid a shortage of accommodation facilities across the country and the changing ways people travel.
Under the hotel business law, accommodations are divided into four categories: hotels, inns, simple accommodations and boarding houses.
In the case of ordinary hotels, the reception desk, restaurants, stores and other facilities are located inside the same building. But in the case of Sekai Hotel, these are located separately at what were previously unoccupied houses in Nishikujo.
Guests check in at the reception desk in one house and then go to their rooms in a different one. It is also hoped that guests will visit nearby eateries and shops, pumping even more money into the local community.
Sekai Hotel is starting with six guest rooms, which can accommodate just over 30 people, in a residential area near Nishikujo Station.
The number of rooms is to be increased gradually to 40 within several years to handle up to around 200 people. Sekai Hotel is initially aiming to operate at 85% capacity.
Universal Studios Japan, a popular theme park in Osaka, is about five minutes by train from Nishikujo Station. But the area around the station is dotted with vacant houses and has not been fully redeveloped because of difficulties in acquiring large plots of land.
Kujira purchases uninhabited houses, renovates them and resells them to new owners who then lease them back. The company will also be in charge of other tasks such as changing sheets and cleaning rooms.
Sekai Hotel's individual guest rooms are classified as minpaku facilities and are available to tourists staying two nights or longer.
But if a row house as a whole is used as guest rooms, it is classified as a simple accommodation under the hotel business law. Such a house can accommodate less than 10 guests at the same time and can be booked for a single night.
Together we stand
The Sekai Hotel project hopes to attract restaurants and shops to the community to make it more alluring to tourists. Its reception desk will also serve as a local hub for tourism.
Language companies, law firms and other companies are participating in the project. The idea is that a diverse company structure can improve services.
In response to growing demand for the minpaku service from foreign tourists, Japan enacted a new law on Friday, lifting a ban on the service across the country. The law is scheduled to take effect in January 2018.
But how to prevent friction between local residents and guests over noise, garbage and other possible nuisances has emerged as an issue. By setting up its reception desk in the area, Sekai Hotel is looking to allay residents' concerns.
Sekai Hotel is planning to allow local residents to take part in operations within five years. There are high hopes that the project can become a model for breathing new life into Japan's local communities.