In Japan’s fast-growing hotel sector, AXE Management focuses on developing value enhancement strategies on properties that maximize returns on real estate investments.

AXE Management Partners (based in Minato-ku, Tokyo) opened three hotels in Osaka City in February of this year under the new midscale brand "Garner Hotels" of IHG Hotels & Resorts, the brand’s first launch in Asia, through TMK7C. Gary Kwok, Founder and CEO of a real estate investment company that covers all of Asia, is breathing new life into the hotel industry with his innovative ideas. We spoke to him about his outlook for the future of the hotel industry and real estate investments.
※アクス・マネジメント・パートナーズ 代表取締役 ゲイリー・クォック氏の日本語インタビューは2025年月刊ホテレス6月号と、web記事3ページ目から掲載しております。
 

Axe Management Partners Limited
Representative Director and CEO
Gary Kwok

Gary Kwok graduated from the London School of Economics and Political Science with a MSc. and BSc. in Accounting and Finance. He is the Founder and CEO of AXE Management Partners Limited (“AXE Management”), an alternative investment company focusing on real estate across asset classes in Asia. His most recently investments include acquiring from CapitaLand Ascott Trust Limited the 500+ rooms three-hotel portfolio in Osaka, being the first in Asia to partner up with IHG Hotel & resorts to reposition and launch its new midscale brand “Garner Hotels”. Prior to founding AXE Management, he has held various senior positions at Credit Suisse and Bank of America Merrill Lynch specializing in corporate finance, advisory and M&A across industry sectors, completing transactions of over US$50bn. Most recently he headed Bank of America Merrill Lynch’s Asia real estate hospitality and gaming business, during which he has led the effort to many landmark transactions and achieving multiple industry awards. In addition to his real estate finance experience, he also previously held the position of Representative Director and CEO of a Tokyo-listed real estate and hospitality company. The Company businesses include planning and construction of greenfield projects, asset acquisitions, and operations of real estate and hospitality assets with over 1,000 employees. Under his leadership, the Company has successfully completed transformational initiatives to refine strategic vision and corporate values, and maximize operational efficiencies, bringing the Company towards global standard. In recent years, he has been widely recognized in the industry as one of the rising investors in the region. 

Japan is an attractive real estate investment market where you can get big returns with small investments

----What are AXE Management's strengths as a real estate investment company?

AXE Management is a private investment company focused on real estate across Asia, including Japan which is one of our key region. Our core strength is in value-add investments, where we deploy strategies like repositioning and rebranding to maximize asset value. This capability is driven by our team’s extensive experience, anchored by my own diverse background. At Bank of America Merrill Lynch, I led the Asia real estate hospitality and gaming team, alongside other sub-sectors, structuring and executing over US$50 billion (7.5 trillion yen) in financial transactions that delivered significant value for many regional and multi-national corporates. Later, as CEO of real estate and hospitality developer and operator, I gained deep expertise in asset acquisitions, construction, development, and operations. This rare blend of financial structuring and on-the-ground execution enables us to design highly attractive investments. This has been demonstrated by our Osaka hotel portfolio repositioning this year, where have been heavily involved to lead the full investment cycle and applying our skillset.

----According to a think tank report, Japan has a better cash-on-cash return (dividend on equity) than other countries, and is considered an attractive real estate investment market for investors. Do you agree, Gary?

The think tank report raises a valid point, though a balanced perspective is warranted. Our approach to any investment always begin with an assessment of the fundamentals, and Japan’s real estate market certainly presents notable advantages. For investments that utilize debt  to enhance returns, commonly referred to as levered strategies, Japan certainly benefits from its low interest rate environment. Compared to many other countries where financing costs are considerably higher, borrowing in Japan remains more attractive, allowing the income generated from a property to deliver a stronger return on invested capital. This structural benefit positions Japan as an appealing choice for certain investors employing leverage. 

For investments funded entirely with equity, the outcome is less uniform. Here, the cash-on-cash return hinges on the specific attributes of the asset: its income potential, inherent risks, and other asset specific characteristics like its location etc. Japan offers a compelling foundation, with a robust domestic tourism base, a steadily increasing influx of international visitors, and a well-established legal framework that inspires confidence among investors. These factors can make certain properties, such as hotels in prime urban areas, particularly attractive. 

----In Japan, hotel investments are gaining particular attention—especially among overseas investors. What are the main reasons for this trend?

Japan boasts a solid base of domestic tourism, providing stability, paired with a surge of international visitors that’s soared past pre-pandemic levels since 2023. This combination naturally attracts all types of investors, both domestic and overseas, looking for reliable growth. Although the industry is already blossoming, we still believe the tourism industry in Japan still have a lot of potential to grow in the coming years. Japan provides all types of travellers a very high-quality experience, whether it is a luxury or budget traveller. As the disposal income of more middle class Asian and global population increase, Japan becomes the natural destination to seek for a comfortable stay. Furthermore, Japan still have a lot of beautiful cities other than the usual destinations by foreign visitors that is currently not yet explored by them and these are all huge potentials. 

From a real estate investment lens, international investors weigh asset allocation across countries. In today’s high interest rate environment, Japan stands out with its low rates, recent hikes notwithstanding, making it one of the only few markets with a positive carry. But it’s not just the economics, Japan’s got a stable and mature investment legal system that’s been honed for decades, giving investors a framework they trust and understood well.