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Free Online ConsultationTokku Minpaku From the Field: Requirements, Eligible Areas, and the Real Revenue Picture
We regularly hear from owners who launched a “tokku minpaku” (National Strategic Special Zone home-stay) property without fully understanding the requirements and revenue mechanics, only to find themselves saying “this isn’t what I expected” once the permit is in hand. Tokku minpaku, established under the Act on National Strategic Special Zones, operates on an entirely different legal framework from the Minpaku Business Act (the “new minpaku law”) and the Hotel Business Act — and its revenue structure and occupancy rules follow their own distinct logic. Drawing on what we’ve seen firsthand through Stay Buddy’s property management operations, this article walks through the core framework and the real-world revenue picture.
What Is Tokku Minpaku? Its Place Under the Act on National Strategic Special Zones
Tokku minpaku is formally grounded in Article 13 of the Act on National Strategic Special Zones. Created to promote longer stays for inbound foreign travelers, it allows operators to provide lodging services without falling under the Hotel Business Act. While the Minpaku Business Act (new minpaku law) caps annual operating days at 180 nationwide, tokku minpaku has no such cap. In exchange, it imposes a minimum stay requirement — generally two nights and three days or more.
Oversight falls to individual local governments, with approval authority resting with prefectural governors or the mayors of designated cities. The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) and the Japan Tourism Agency publish guidance on “the handling of minpaku in National Strategic Special Zones,” and each municipality builds its own ordinances and rules on top of that framework — meaning additional local requirements are common.
Eligible Areas and How Requirements Differ by Municipality
As of 2025, the main municipalities granting tokku minpaku approvals are Ota Ward in Tokyo, Osaka Prefecture, the City of Osaka, and Kitakyushu City. All approvals are limited strictly to properties within officially designated National Strategic Special Zone areas — even within the same city, a property located outside the designated zone won’t qualify.
Requirements vary considerably by municipality. Osaka Prefecture and the City of Osaka apply their own standard requiring a minimum room floor area of 25 square meters, which automatically excludes many 1K and studio-style units at the application stage. Tokyo’s Ota Ward, meanwhile, takes a different approach to verifying the “for foreign guests” requirement. Before applying, it’s essential to check the latest rules directly with the relevant municipal office. The Japan Tourism Agency’s page on tokku minpaku approval status offers a general overview of approval trends, but the fine print on requirements needs to be confirmed at the municipal counter.
Key Requirements for Starting a Tokku Minpaku
Minimum Stay of Two Nights, Three Days
This minimum-stay rule is the single biggest constraint of tokku minpaku. It shuts you out of one-night bookings and short workation-style demand, and OTA search algorithms often won’t even surface your listing to guests looking for a single-night stay. We’ve seen this play out firsthand at a property we manage in Osaka, where an oversight led to a one-night booking being accepted — creating real risk that the approval could be revoked. Setting the minimum-night restriction in your booking system needs to happen at the same time as your permit application, without exception.
Facility and Equipment Requirements
Standards for room area, ventilation, natural light, and fire safety equipment blend requirements carried over from simple lodging houses under the Hotel Business Act with rules unique to the special zone framework. Fire safety equipment mandated under the Fire Service Act — automatic fire alarms, evacuation guide lights, fire extinguishers, and the like — is required based on property size, and tokku minpaku offers no exemption here. In practice, it makes sense to run fire department consultations in parallel with your approval application rather than waiting.
Contracts, Identity Verification, and Management Systems
Operators are required to execute written contracts (including in foreign languages) and to record and retain identity verification documents such as passports. Municipalities frequently also require notifying neighboring residents and setting up a complaint response contact point. Confirming permission under building management rules — including, for condominium units, a resolution from the management association — is typically part of the application requirements as well.
The Real Revenue Picture: How Occupancy and Nightly Rates Play Out
Revenue comes down to average nightly rate × operating days × occupancy rate, minus fixed and variable costs. Tokku minpaku has the advantage of no legal cap on annual operating days, but the two-night minimum stay directly constrains occupancy. Depending on location, property type, and season, occupancy rates at properties we manage run 70–85% during peak periods and can drop to the 30–50% range in the off-season. Realistically, even in strong locations, it’s sensible to build financial projections around an annual average occupancy of roughly 50–65%.
On pricing, properties of 25 square meters or more near tourist areas often see nightly rates in the ¥10,000–30,000 range in many cases, though this varies by area, competition, and season. OTA commissions differ by platform but generally run 10–20% of sales. After factoring in cleaning fees, linen costs, supplies, management fees, and fixed costs (insurance, internet, utilities), actual take-home revenue often ends up 20–30% lower than initial projections.
How Tokku Minpaku Compares to the New Minpaku Law and the Hotel Business Act
| Item | Tokku Minpaku | New Minpaku Law (Minpaku Business Act) | Hotel Business Act (Simple Lodging) |
|---|---|---|---|
| Legal Basis | Act on National Strategic Special Zones | Minpaku Business Act | Hotel Business Act |
| Annual Day Cap | None | 180 days | None |
| Minimum Stay | Generally 2 nights, 3 days | None | None |
| Eligible Areas | Designated special zones only | Nationwide (subject to local ordinances) | Nationwide |
| Procedure | Municipal approval | Notification to prefecture | Prefectural governor’s license |
Which Properties Are — and Aren’t — a Good Fit for Tokku Minpaku
If your property meets the 25-square-meter minimum and sits within a designated special zone with solid inbound demand, tokku minpaku can be an effective way to maximize long-term revenue, since there’s no cap on annual operating days. On the other hand, if you’re looking to rent out a property for single nights, or you’re located in a depopulated rural area, this scheme simply isn’t an option. The risk of losing out on short-stay business travelers or domestic tourists who want just one night varies significantly by location due to the minimum-stay rule. The smart approach is to weigh your property’s characteristics against your revenue goals first, then decide whether tokku minpaku, the new minpaku law, or the Hotel Business Act is the right fit.
Free Consultation and Management Services From Stay Buddy Co., Ltd.
Stay Buddy provides full operational management for minpaku and hotel-business properties. From supporting your tokku minpaku approval application through to OTA listing management, reservation handling, cleaning coordination, guest support, and revenue reporting after you receive your permit, we handle the day-to-day work end to end. Feel free to reach out even at the earliest stage — whether your property qualifies for tokku minpaku, or which scheme makes the most sense for you.
Approval procedures differ by municipality, and it’s not unusual for applications to be delayed by paperwork errors or overlooked equipment requirements. We support clients through pre-application property surveys, coordinating fire department confirmations, and preparing explanatory materials for management associations — all with the goal of preventing the “unexpected costs” that so often surface after the application is filed.
Once operations are up and running, decisions made on the ground — adjusting pricing strategy for busy and slow seasons, responding quickly to neighbor complaints — continue to have a direct impact on revenue. Rather than owners shouldering every task themselves, building a structure where day-to-day operations are handled by experts while owners keep a clear view of the numbers is what leads to stable, long-term success.
Your first consultation is free. Share your property’s address, floor area, and current usage with us, and we’ll provide an assessment of which scheme applies along with a rough revenue estimate. Please reach out through the contact form at the bottom of this page or by phone — we’re happy to help.
