|The story below is originally published on Mainichi Daily News by Mainichi Shinbun (http://mdn.mainichi.jp).|
|They admitted inventing its kinky features, or rather deliberately mistranslating them from the original gossip magazine.|
|In fact, this is far from the general Japanese' behavior or sense of worth.|
Wise Japanese investors add love hotels, starlets to their portfolios 2006,09,28
Shukan Gendai 10/7 By Ryann Connell
Nestled away in a traditional love hotel quarter in Tokyo's Uguisudani district, Hotel P Door looks just like any other establishment in its particular line of business.
A plague beneath the neon sign contains two prices, 4,600 yen for a rest and 7,500 yen a stay, a giveaway that the hotel is dedicated to amorous couples.
What makes Hotel P-Door stand out, according to Shukan Gendai 10/7), is that some of its operating capital comes through Hope Alpha 2, a fund that finances the love hotel's operations in return for payouts of up to 8.4 percent annual interest.
Love hotels are among the many unusual businesses coming to the aid of struggling investors in Japan who can look forward to interest of less than 1 percent for any money they put into the bank.
Hope Alpha 2 agrees.
"Normal hotel rooms only have a single customer a day, but with a love hotel, you can get as many as three or four customers in the same room every 24 hours. Love hotels are also built to be replaced every few years, so construction costs are comparatively cheap. That allows for profits unthinkable in lots of other types of businesses," Shuzo Shinano tells Shukan Gendai.
"We've paid out dividends on time and will continue to do so from now on, too."
Others agree that love hotels can be a potentially lucrative investment.
"(Funds are) a somewhat shady business. You want to invest in an industry that has a history and tradition of being a profitable business. Love hotels are precisely that.You're not investing in the hotel itself, but in the profits it makes, which means you can expect a high return on your outlay," securities journalist Genichiro Tenkai tells Shukan Gendai.
P-Door is currently accepting investors willing to foot at least 500,000 yen apiece and will continue doing so until Nov. 22.
It pledges an 8.4 percent payout for the first year over a five-year investment and plans 12 percent plus from the second year on.
Payouts are made twice annually, in January and July, but Hope Alpha 2 warns that dividends are entirely dependant on the hotel's business performance and that principle investments are not guaranteed.
Love hotels aren't the only peculiar funds punters can choose to invest their cash in.
In 2003, the Shinjin Gurabia Aidoru Dai-Ichi Go fund sought 50,000 yen investments in the careers of five young women it hoped to manage into pinup queen stardom.
Money collected was supposed to fund the production of photo collections and DVDs featuring the starlets, with profits split up amongst the investors, which proved profitable for some.
Not every funny fund is a roaring success, though.
Take the Ramen Fund, which ended up getting those who invested 500,000 yen apiece into a ramen theme park in Tokyo's Shibuya-ku doing their noodle.
The theme park promised annual returns of 10 percent, but went bust within a year and speculators were lucky to at least receive their principle outlays back.
Securities analyst Haruo Ueki warns that freaky funds like investing in love hotels should only be pursued with caution.
"Investment funds don't guarantee the principle investment, so it's important to look at past performance before committing. Love hotel funds have maintained high dividend payouts, so they appear to be pretty good, but don't forget things like fire or management problems can arise in the place you've chosen to invest in. Something like that happens and you can forget your dividend and the principle may be in danger at times, too," Ueki tells Shukan Gendai.
"It's really important to look into whether the place you want to invest in is risky or not. And don't forget some places won't let you pull out after only a year. Whatever way, these funds should only be invested in if you have money you can afford to lose."