Alpine tourism ignites billion dollar resort property market
by Bill Barnett of c9hotelworks.com
Niseko visitor numbers continue to climb on the back of a sharp increase in airlift.
Tourism arrivals to Asia’s leading alpine destination, Niseko, rose 17% year-on-year in 2017 and bumped up a 5-year growth spree with an impressive 16% compound annual growth rate. One clear sign of market maturation is a push to a year-round marketplace as last year 48% of tourists came during the summer season.
Last year Niseko recorded a record-high 1,676,300 visitors, with large inroads bolstered by surging regional flights. The top 5 geographic source markets are Hong Kong, Singapore, Taiwan, South Korea and Mainland China, with the latter benefitting from direct international flights from 8 cities into the gateway New Chitose Airport.
For travelers from Thailand, access to Niseko has been effectively doubled with Thai AirAsia X launching direct flights in April, joining Thai Airways who already serve the popular route. Investment by real estate players has been highlighted by Property Perfect PCL’s investment into the Kiroro Resort. Featuring a Sheraton branded hotel and a second under the Tribute flag, the mixed-use resort recently launched their first condominium project Yu Kiroro.
One sector that is having a direct impact from tourism is the property sector. According to new data released by consulting group C9 Hotelworks in their Niseko Market Review, the transaction value of resort-grade real estate developments currently in the market is set to tip to USD1 billion mark over the next two months.
Speaking about the connection between hotels and property offerings C9 Hotelwork’s Managing Director Bill Barnett commented, “given high land values and elevated country-wide construction costs which have been impacted by the build up to the 2020 Tokyo Olympics, it’s extremely hard to underwrite sole hotel developments.
“Projects like Hong Kong’s PCPD Groups’ upcoming Park Hyatt Hotel and Residences has mitigated the situation by selling managed residences as part of the hospitality offering. A similar scenario is playing out at the Niseko Village integrated resort where the Malaysian-based owner YTL is planning a similar Ritz-Carlton Hotel and branded real estate combination.”
With its substantial inventory of resort condominiums and homes, Niseko is very much a tourism model like alpine destinations in the West such as Whister, Vail and Aspen. Examining the recent move by the Japanese government to effectively legalize Airbnb-type rentals via the ‘minpaku’ legislation has been seen by the local tourism community as a positive, given a legitimate solution is now in place to effectively manage non-traditional accommodation.
To download C9 and read Hotelworks Niseko Market Review, click HERE.
