On September 8, 2026, the Mayor of Shinjuku announced plans to introduce new restrictions on short-term accommodation businesses in the Ward.
The proposals have not yet been finalized and will go through a public comment process. However, they provide another important indication of where short-term rental regulations in Tokyo are heading.
1. What Shinjuku Ward Is Proposing
The proposed changes affect both minpaku properties operating under the Residential Accommodation Business Act and hotels and ryokans operating under the Hotel Business Act.
For minpaku, the proposal would generally prohibit operations in residential-use zoning areas. According to the Mayor, approximately 2,200 of the roughly 4,000 minpaku properties in Shinjuku are expected to be affected by the new zoning restrictions.
In commercial-use areas, the annual operating limit would also be reduced from 180 days to 120 days.
Importantly, Shinjuku Ward has stated that these restrictions would apply to existing minpaku properties after a two-year transition period.
If implemented as proposed, the impact on existing accommodation supply in Shinjuku could therefore be substantial, particularly at a time when demand for accommodation continues to grow.
For hotels and ryokans, the approach is different. Shinjuku Ward is proposing stronger operational requirements, including a physical front desk, on-site staffing and face-to-face check-in.
One of the main reasons given for the reforms is the number of operators that do not properly follow existing rules. Shinjuku continues to receive complaints regarding issues such as garbage disposal, noise and inadequate property management.
At the same time, the Mayor acknowledged that there are legitimate operators that manage their facilities properly and briefly mentioned the possibility of considering exceptional measures for businesses that are not causing problems for the surrounding community.
Questions were also raised during the press conference about the potential impact on hotel prices and the economic benefits that accommodation businesses and international visitors bring to Shinjuku.
The proposals have not yet been finalized, and it will be important to see how the rules ultimately take shape following the public comment process.
2. The Broader Direction in Tokyo
We have written about this trend in previous articles.
Although the exact rules differ between wards, the general direction in Tokyo is becoming relatively clear:
Minpaku is becoming more restricted, while hotels and ryokans are increasingly expected to have a stronger on-site management presence.
For investors, this distinction is important.
Minpaku remains relatively easy to establish compared with obtaining a hotel or ryokan license, but it is increasingly exposed to local restrictions on operating areas and days. It also cannot simply be transferred to a new owner in the same way as a hotel or ryokan business license.
A hotel or ryokan license requires considerably more work from the beginning, including building, fire-safety and licensing requirements. However, for properties that can meet those requirements, we continue to believe that the hotel/ryokan model provides a more sustainable investment model over the long term.
3. Our View Going Forward
The Shinjuku announcement reinforces our view of where short-term rental investment in Tokyo is heading.
First, in central Tokyo, we want to continue prioritizing hotel and ryokan licenses over minpaku wherever possible.
Minpaku can still be a good option for the right property, but the combination of increasing local restrictions and the difficulty of transferring an existing registration makes it less suitable as a long-term strategy in prime locations.
Second, we believe moving toward larger-scale investments could create new opportunities.
If on-site management becomes increasingly important in prime locations, larger buildings have a natural advantage. A multi-unit property can potentially allocate one unit to staff and management functions while operating the remaining units as guest accommodation.
At the same time, tighter regulations may reduce the number of existing accommodation facilities and make new supply increasingly difficult. For investors who can establish a viable on-site management structure, however, this could present an opportunity.
Tourism demand is expected to continue growing, while conventional hotels in central Tokyo are often expensive and offer relatively limited space. Larger short-term accommodation can help fill this gap, particularly for families and groups looking for more space without paying for multiple hotel rooms.
In the longer term, we would like to take this concept one step further and eventually structure these types of properties ourselves — or together with investors — obtain hotel/ryokan licenses, and offer individual units to overseas buyers, making the “Tokyo second home + short-term rental” model easier to access within a professionally managed structure.
If you are an investor interested in exploring this type of project with us, we would be happy to hear from you.
