Jim Ivanoff | ivanoff@bcwood.jp
At the beginning of the year, I visited the Hakuba ski resort in Nagano and found that much like Niseko 10 years ago, it was booming with foreign visitors, but infrastructure to support such tourists was lacking. During my stay, I was able to speak with local people in the tourism industry and they told me about the challenges the resort was facing. I wanted to speak with some of the resort operators in the area to get their perspectives, so I recently met with one of the major players which has assembled and operates eight resorts.During the meeting, I was struck by the representative’s candor in discussing the insufficiencies he saw in their facilities. Most ski resorts were built during the bubble era by railroad related real estate companies with the “if you build it, they will come” mentality. Unfortunately, the end of the bubble economy coincided with a demographic shift that ushered in an age of a decreasing numbers in the domestic skier population. Less spending and fewer skiers meant that most resorts did not receive further investments which has left many well behind their overseas competitors. Companies such as the one I met with saw this as an opportunity to buy these unloved ski hills and reinvigorate them. The representative pointed out that inbound visitors have given them the new, growing market they need, but these customers have seen resorts around the world and have high expectations.
The obvious place to start is with modern, fast lift capacity as well as improved terrain. However, Japanese resorts have been most lacking in on hill services and amenities. The original developers typically wanted to take in all of the profits, so they operated their own simple cafeterias and shops. The company I met with sees this as one of the main areas they need to improve on and are looking to build new on hill facilities as well as to bring in new hospitality partners to improve the quality and variety of food. The retail spaces they own at the base of the hills also offer interesting opportunities for redevelopment. Many small shops were built on large parcels of land that could now accommodate multi-purpose buildings with retail on the first floor and lodgings above. The company is looking for partners to invest and run such operations. After explaining some of the financial benefits of choosing wood, he told me that they see using wood as both a visual match for their natural surroundings as well as a match with their company’s focus on protecting the environment.
One of the other major challenges they face is making their properties year-around resorts. For this, they are looking abroad at places like Whistler and how they were able to become four season destinations. As a result, they have been investing in mountain biking and outdoor play facilities for children. Other infrastructure such as patios and observation decks are also being built to enhance the experience of “green season” visitors. Domestic tourists are more likely to visit such areas in the summer to escape the heat of Japanese cities. Activities such as “glamping” are being introduced at many resorts to tap into this segment and this also offers opportunities for smaller log and timber structures. The company I met with has started experimenting with glamping at one resort this summer.
We will be meeting with more such resort developers in the coming months leading up to the Japan Home Show to unearth more opportunities for members. Undoubtedly, many of these resort operators are looking for ideas from abroad to improve their facilities and meet the levels expected by international travellers. During the Japan Home Show, participating members will be able to meet with these companies so that we can further develop Japan’s resort market for our industry.
For more information on BC Wood’s efforts in Japan’s resort sector and about how to get involved, please contact Jim Ivanoff at ivanoff@bcwood.jp.