INSIDE: Niseko Investment Destination

by Li Haohan
10 Dec 2021

Strong fundamentals support luxury property investments in Niseko

A village in western Hokkaido, Niseko is well known to avid skiers, particularly those who have been on other famous slopes around the world such as Aspen, Whistler, and Courchevel to which it is compared favorably. A pristine environment with ample sporting and leisure activities, however, turns Niseko into a year-round destination.

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These factors make Niseko an ideal destination for property investment, asserts Peter Koh, CEO of HJ Real Estate Pte Ltd. His company deals in real estate sales and lease, as well as asset management. In Japan, it focuses on the sale of hotels, commercial buildings, condominiums, winter homes, and resorts.

According to a report on the website Housing Japan, Niseko’s popularity remains high despite having established a reputation as an international resort. Recent investments from developers across the town’s five ski resorts have expanded options for accommodations, including luxury establishments that have boosted the brand’s value proposition. “There have also been improvements to the entertainment scene and green season, attracting more visitors throughout the year,” the report continues. All these are boosted by Japan’s booming inbound tourism and foreigner-friendly real estate market.

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Access to Niseko currently is mostly via New Chitose Airport from Tokyo, and from there a tram ride to Kutchan Town. But come 2030, a new shinkansen route will be launched directly from Tokyo thus cutting travel time to just over four and a half hours while increasing comfort tremendously. This is expected to bring more visitors from the city and the surrounding Kanto region and dovetails with Niseko’s ambition to host the Winter Olympics in 2030. 

Luxury is evidently the sector to invest in. Housing Japan emphasizes that developers are focused on catering to the demands of the luxury market, including “tie-ups with nearby hotels or condominiums to offer the exclusive services of that brand. Properties might benefit from a members’ club, health spa or swimming pool”. Many developers go the extra mile with a butler or valet service to attract HNWI, says Ken Nakazawa, Acquisition Director at HJ Asset Management.

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Koh is positive that demand will remain unabated in the medium term. HJ Real Estate is currently marketing New World La Plume Niseko Resort, a large hotel-condominium development with outstanding facilities. “We believe the development has strong fundamentals that will appeal to both investors and occupiers. Our offer to buyers of a 5 per cent gross yield (based on purchase price) for the first three years is the first in the area and supports our view of the viability of the investment.”