traditional inn in a popular tourist area
A type of ryokan located in a sightseeing destination, often catering to tourists with local cuisine and hot springs.
See also: 旅館
This traditional tourist inn prides itself on its hot springs and local cuisine.
We stayed at a traditional tourist inn and visited nearby attractions.
旅館 is a general term for a traditional Japanese inn, while 観光旅館 specifically refers to one located in a tourist area and oriented toward sightseeing guests.
Compound of 観光 (sightseeing) and 旅館 (traditional inn).