TOKYO -- A Japanese fund is hoping to cash in on the rising popularity of temple and shrine lodgings among tourists by attracting investors who are hunting for returns amid negative interest rates.
Sun Capital Management, a Jasdaq-listed real estate fund manager, established a special-purpose company this month along with the Temple & Shrine Tourism Association, an organization that manages temples nationwide, to build lodgings for numerous temples and shrines in Osaka's Tennoji district. The company aims to raise about 500 million yen to 1 billion yen ($4.96 million to $9.92 million) from wealthy and institutional investors.
The lodging facilities will include about 30 rooms and are to be completed as early as March. The funds raised will also be used to operate the facilities.
Temple and shrine lodgings are increasingly popular among foreign tourists seeking cultural experiences such as participating in a Japanese tea ceremony, eating vegetarian meals or trying sutra transcription, the practice of hand-copying Buddhist texts. However, the temples and shrines have had trouble raising enough funds to meet demand.
Investment returns are about 5% for hotels in Tokyo. Sun Capital predicts that temple and shrine lodgings will beat those returns, as the cost of building and operating them is lower compared with regular Japanese hotels and inns.
Sun Capital is planning additional funds to build lodging in cities including Kyoto and Hiroshima. It aims to invest in about 500 lodging facilities over the next few years.