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One REIT to Acquire Kyoto Hotel for JPY 4.8 Billion, Sell Local Office Building for JPY 5.0 Billion

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One REIT to Acquire Kyoto Hotel for JPY 4.8 Billion, Sell Local Office Building for JPY 5.0 Billion

One REIT to Acquire Kyoto Hotel for JPY 4.8 Billion, Sell Local Office Building for JPY 5.0 Billion

One REIT will acquire the “Candeo Hotels Kyoto Karasuma Rokkaku” in Nakagyo Ward, Kyoto, for JPY 4.8 billion on December 18, 2025. At the same time, it will sell the “ONEST Kyoto Karasuma Square,” an office property it owns in the same Karasuma area, to Tokyo Tatemono Co., Ltd. for JPY 5.0 billion. The REIT aims to enhance portfolio quality through a strategic asset rotation.

The hotel to be acquired was completed in March 2021 and is located about a 3-minute walk from Karasuma Oike Station on the Kyoto Municipal Subway Karasuma Line. It contains 106 guestrooms and features a sukiya-style Kyoto machiya lounge that reimagines the former Banke Residence, a registered tangible cultural property of Kyoto City. A sky spa further enhances the property’s competitiveness. The appraisal value is JPY 5.16 billion, and the acquisition price reflects a roughly 7% discount. The fixed rent under a fixed-term lease ensures stable income with limited capital expenditure requirements.

The hotel will continue to be operated by Candeo Hospitality Management, a nationwide operator specializing in four-star hotels. As of March 2025, the company manages 28 properties with 5,770 rooms and posted JPY 19.3 billion in revenue in 2023. It plans to increase its room count by 70% by 2030. The operator also has a track record of supplying assets to J-REITs, including “Candeo Hotels Nagasaki Shinchi Chinatown” to Daiwa House REIT Investment Corporation.

On the other hand, the office building to be sold was completed in November 1986 and is now approximately 39 years old, with future capital expenditure expected to increase. The property is 91.8% occupied as of the end of August 2025, with limited rent growth potential. The sale price of JPY 5.0 billion exceeds its book value of approximately JPY 4.0 billion, generating an estimated gain on sale. The disposition will be executed in four stages between March 2026 and September 2027.

Key Facts — Acquisition Property

  • Property Name: Candeo Hotels Kyoto Karasuma Rokkaku

  • Acquirer: One REIT, Inc.

  • Seller: Tokyo Tatemono Co., Ltd.

  • Acquisition Price: JPY 4,800 million

  • Appraisal Value: JPY 5,160 million

  • Location: 149 Kotsuyacho, Rokkaku-dori Karasuma Nishi-iru, Nakagyo-ku, Kyoto

  • Nearest Stations:

    • Karasuma Oike Station (Kyoto Municipal Subway Karasuma Line), approx. 3-minute walk

    • Karasuma Station (Hankyu Kyoto Line), approx. 5-minute walk

  • Completion: March 2021

  • Number of Floors: 10F (steel structure)

  • Gross Floor Area: approx. 927 tsubo (approx. 30,600 sq. ft.)

  • Total Guestrooms: 106

  • Occupancy: 100.0%

  • Cap Rate: 3.5%

Key Facts — Disposition Property

  • Property Name: ONEST Kyoto Karasuma Square

  • Seller: One REIT Investment Corporation

  • Buyer: Tokyo Tatemono Co., Ltd.

  • Disposition Price: JPY 5,000 million (combined total across four installments)

  • Appraisal Value: JPY 4,150 million

  • Location: 634 Shichikannon-cho, Karasuma-dori Rokkaku Sagaru, Nakagyo-ku, Kyoto

  • Nearest Stations:

    • Karasuma Oike Station (Kyoto Municipal Subway Karasuma Line), approx. 5-minute walk

    • Karasuma Station (Hankyu Kyoto Line), approx. 4-minute walk

  • Completion: November 1986

  • Number of Floors: 8F / B1 (steel-reinforced concrete)

  • Gross Floor Area: approx. 3,630 tsubo (approx. 120,000 sq. ft.)

  • Occupancy: 91.8% (as of end-Aug. 2025)

  • Cap Rate: 4.4%

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