World Cup 2002 - Down and out in Osaka: Slum Hotels Trying to Lure Guests

by R. Sanborn Brown

Imagine planning your vacation or business trip to New York and booking a bargain hotel in the south Bronx. In Japan's largest slum, Osaka's Airin ("lovely neighborhood") Ward, hoteliers are sprucing up former flophouses in the hopes that foreign guests, families, and single women will do just that. With an eye toward soccer's World Cup and recently opened Universal Studios Japan (USJ) trade, hotels have even started advertising on the Internet in foreign languages.

This is the same Airin that witnessed more than a thousand rock-throwing laborers riot in 1990 over police installation of surveillance cameras in the area as a way of reducing crime. This is the same Airin that has long been called home by two of the most discriminated groups in Japan: ethnic Koreans and burakumin, the traditional outcast class or untouchables. This is the same Airin in which "crime syndicates known as yakuza have 45 known storefront offices, from which they run gambling operations, extortion schemes and businesses that supply laborers to construction companies in Osaka."

An article in the Asahi Shinbun reports that in the past rooms in Airin--long synonymous with the destitute and more recently with the above disturbances--geared to the day laborer market were often little more one tatami (6 x 3 feet) spaces that had neither heat nor windows. During Japan's bubble economy of the late 1980s and early 1990s, many of the above hotels were upgraded to business hotels. Televisions and refrigerators and heat became de rigueur. As a result, nightly rates more than doubled from 700 yen (US $5.50) to 1,500-2,000 ($11.80-15.70). For local day laborers, however, the sudden rise in rates--coupled with the onset of the recession and fewer available jobs--meant they were priced out of local accommodations. Which in turn hurt the hotels themselves: occupancy rates fell to 50%, or well below the 70% margin necessary to make a profit.

With the Japanese economy showing few signs of ever bottoming out, hotel owners began looking farther a field for potential guests. Thanks in part to the opening of USJ, budget travelers from South Korea and Taiwan now make up 20% of the clientele in Airin. Many have heard of the hotels by word of mouth. Kim Wan Han, who was on business from South Korea, said, "In Japan, which has so many expensive hotels, a clean and comfortable room for $15 is very appealing." A woman from New Zealand noted that for the same amount as the cost of one night at an average hotel, you could stay in Airin for a week.

The Chuo Group hotel chain, which runs five hotels with 700 rooms in Airin, views the June World Cup as a once in a lifetime opportunity. Last year, the chain started running ads in Korean and English on its web page in preparation for June. "We might lose out in luxury, but for comfort and price why don't you give us a try!" "For a Taste of Osaka's Downtown Scene." Korean-speaking staff have been hired, and maps to the World Cup venues are available in the lobbies.

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