Answer: This is Kobe's annual Luminaria festival where they erect this huge display of lights around the city's central district. It began as a memorial to the victims of the 1995 Kobe Earthquake and has now become a huge tourist attraction for the city during its winter months. There didn't seem to be much memorializing going on at the festival, although I think much of the money raised from it was going to go towards some related cause. Much of the festival seemed to be centered around walking through the city past a lot of shops (who were all vying for sightseers' attention) to this central area where there were a lot of lights and many many more street stalls with delicious foods.

Lights along the main road to the memorial park in downtown Kobe

In front of the main illuminated structure at the center of the park
AWESOME! Reminds me a little bit of the ice festival in Harbin - but with lights AND ice!:
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