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SHIKI NISEKO, Low Yat Group’s luxurious high-end development in Niseko, Hokkaido, offers more than just great design and sophistication.
“It offers incredible views of Mount Yotei, spacious apartments, a front desk, retail space and the Michelin star Kamimura Restaurant,” says general manager Darren Wickings. “In fact, Shiki is an all-year-round resort development.”
Niseko is considered the Aspen of the East and is well known to skiers and snowboarders for its powder snow and long ski season that starts in November and ends in April, with January being the busiest month. Since Shiki’s opening in December last year, it has seen full occupancy during winter, says Wickings.
Targeted at high net worth individuals and their families, Shiki — which means four seasons in Japanese — is not just for avid skiers, but also for those who love the finer things in life all year round. Managed by Fairland Hospitality, the hospitality arm of Low Yat Group, it stands out from other accommodation in the area because it is a boutique development for the wealthy.
When Shiki was launched in 2010, its take-up rate was about 20%, but interest dwindled due to the 2011 earthquake and tsunami that damaged the Fukushima nuclear plant.
“The group has worked tirelessly to overcome the negative publicity that followed the earthquake and tsunami, although Hokkaido was not affected at all,” says executive director Low Su Ming. “The island is not affected by any fallout and the environment is fully preserved.”
In fact, the affected area is over 600km from Hokkaido and the radiation level in Niseko is lower than that in Singapore.
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| Haggart, N K Yeoh, the area general manager of Fairlane Hospitality, and Low are happy that Shiki is garnering attention both in Japan and Malaysia |
As fears of contamination recede, Niseko is seeing more tourists. Figures provided by Paul Haggart of Niseko town council’s tourism and industry division reveal that there was a 26% increase in tourist arrivals — from 161,815 to 204,162 — between November last year and January.
The Japanese government is also trying to showcase Niseko as an ideal summer vacation destination. From 2002 to 2010, the summer or “green” season from April to September drew 1.5 million tourists on average, and this is looking to improve.
As there is a large international community in Niseko, English is spoken widely, so fears of a language barrier are unfounded, says Low. Moreover, security in the area is tight and there are enough open spaces for children to run around while the adults sip their tea or hot ocha (green tea) in comfort.
Thanks to the increase in tourist arrivals and the government’s promotion of Niseko, Low Yat Group is resuming the sales of Shiki’s luxury units. It will soon be conducting private previews in Malaysia, Singapore, Indonesia and Thailand. Prices start at US$500,000, and the group provides a guaranteed return of 4% per annum over five years.
Sales manager Wang Ie Ian says the yield last winter was 2% while Fairlane Hospitality believes a return of 4% is achievable over the five-year period.
The ¥5.6 billion Shiki boasts 68 fully furnished rooms as well as 1, 2 and 3-bedroom apartments from levels two to six. The size of the typical units ranges from 624 to 1,636 sq ft while that of the penthouses is from 990 to 1,367 sq ft. The ground floor is where the commercial and retail outlets as well as the front desk are located.
According to Low, Shiki is practically a build-then-sell model and interested parties can jet over and stay at Shiki to sample its offerings before buying a unit.
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| The warm and welcoming lobby area of Shiki |
Growing interest in Niseko
As Niseko continues to gain in popularity, thanks to its easy lifestyle and abundance of activities, its property prices are going up too.
“Niseko encompasses five main ski areas: Hirafu, Hanazono, Niseko Village, Annupuri and Moiwa,” says Michael Davenport, managing director of Niseko Consulting, a local property consultant. “Of these, Hirafu is the most developed and sees the largest influx of visitors. Correspondingly, it also commands the highest real estate prices.
“Demand for real estate is growing in all parts of Niseko. It has been the highest in Hirafu since the 2008/09 global financial crisis. The winter of 2011/12 was undoubtedly the largest season for real estate in recent years with purchases fuelled by a weakening yen and renewed confidence in global markets.”
Since 2000, mainly Australians have been developing Niseko, building accommodation for skiers and their specific needs. The skiers not only discovered great skiing and snowboarding slopes, but also how cheap it was to buy property in Niseko. “Foreigners couldn’t believe how cheap properties were here; you could get something for US$60,000 near the ski lifts. Slowly, word got out and prices started to rise in line with demand,” says Keith Rodgers, a longtime resident of Niseko and president of Taiga Real Estate & Project Management.
Initially, there were many Western buyers but, as Rodgers pointed out, the market peaked in 2007 with many buyers from Hong Kong. From 2008 onwards more Asian buyers cashed in on Niseko. “Asian buyers accounted for 70% of the market,” says Rodgers. “Of them, most were Hong Kong buyers with a selection of Malaysians and Singaporeans.
But over the past three years, the market has been flat without much appreciation due to the triple punch of the global financial crisis, the tsunami and the strong yen, which all affected property prices. “While the tourist numbers bounced back from the Fukushima incident last winter and were the best since 2007, property sales didn’t follow because of the strong yen,” he surmises.
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| The bedrooms and the living rooms of Shiki are tastefully done with warm colours. Some suites have magnificent views of Mount Yotei |
But this could soon change because the area is slowing attracting interest. “Over the last 24 months, there has been a surge in land purchases and plots are in short supply in Hirafu,” says Davenport. “After huge demand in 2008, the resale of apartments has been a little slow although this sector usually follows trends in land purchases. So, we are expecting demand growth over the next 12 months.”
He also points out that the yield on rental properties varies between 2% and 5%, although many properties garner 2% to 3%. “Capital gain has been high in Hirafu. Land in 2004 was going for as low as ¥30,000 per tsubo but is now trading at ¥200,000 per tsubo. Property prices have held steady in the last three years, increasing about 15% over the last 12 months as we moved into another growth phase.”
A tsubo is equivalent to half a tatami mat that roughly measures 3.3 sq m or 35.5 sq ft and is the measurement system used for all Japanese property.
Future plans
Low is optimistic of growth at Shiki and Niseko, which looks set to reap the benefits of improved tourist numbers and a weakened yen.
“We are seeing Niseko gradually evolve into a world-class gourmet destination, providing a quality lifestyle, which is what Shiki is all about,” she comments. “Shiki is our first prestigious project in Japan and I believe there are many more opportunities to tap if we adopt a long-term outlook. Japan is a highly developed country with fantastic high-quality infrastructure and offers great opportunities in tourism. Japan has long been recognised as a popular tourist destination with a weakening yen, which is attractive enough to lure international tourists.”
Low’s marketing team is looking into flying potential buyers from Malaysia to view Shiki and to feel what it is like to stay in Shiki and enjoy its numerous eateries and activities.
Not one to rest on her laurels, Low is already looking at her next project in Hokkaido. “I hope to do something different from Shiki in and around Niseko. It is a great destination whose natural resources can be tapped. I would like to develop another boutique development.”
However, Shiki’s strategic location, luxurious status and offerings and close proximity to ski slopes and areas of interest make it a hard all-year-round resort to beat.
Niseko offers winter sports and more THE view of Mount Yotei from Shiki Niseko would have been great if a thick cloud hadn’t shrouded its peak. Other than that, the countryside and the balmy weather was a welcome respite from travelling for several hours by plane and two hours by road from the New Chitose Airport to Niseko in Hokkaido. We stayed in one of the apartments in Low Yat Group’s boutique development called Shiki Niseko. The interior was minimalist and classy with creature comforts like flat-screen TV and WiFi. On each floor in Shiki, there is a laundry area with washing machine and dryer as well as free detergent. The ground floor with its lovely lobby is where the spa, café, deli and Kamimura Restaurant are located. Travel in and around Niseko is easy by car and Shiki’s front desk can arrange for one to take guests around. It’s one of the many services provided by Low Yat Group through its hospitality arm Fairlane Hospitality. Drivers in Japan stick to the speed limit, which is around 50kph, but one soon gets used to the leisurely pace and to see more of the surroundings. The local government promotes Niseko’s offerings heavily during summer because winter is already well known to tourists who love to ski and its efforts seem to be paying off.
For those who fear there might be nothing but raw fish to eat, a large international community in Niseko has resulted in cuisines of different kind. Besides small cafés and stores, a good place to head to in Shiki is The Barn, which offers European dishes with nice wines. Not to be missed is Rakuichi, the Japanese restaurant where celebrity chef Anthony Bourdain of the television show “No Reservation” dined. There is also a popular bakery — Boulangerie Jin — that serves to-die-for croissants and bread. Milk Kobo offers delightful ice cream and creampuffs while at the nearby Plativo Farm Restaurant, a lunch buffet awaits you with a view of Mount Yotei in the distance. Besides food, there is the Farmer’s Market where fresh produce from local farmers is sold. The Yokouchi spring, meanwhile, brings fresh water that has filtered through the earth. One can fill a bottle for free. For the outdoor type, there are plenty of trekking options, including climbing Mount Yotei. However, beware bears. They are known to traverse the forested areas around Niseko and warning signs are erected to remind tourists and the locals to be mindful of their surroundings. There are also horseback riding and adventure games such as flying fox and jumping off 4-storey scaffolding into an airbag as well as several golf courses, which can easily be reached by car. However, a trip is not over without a visit to the old Hirafu train station to visit its cat. The cat is known to greet visitors and cat lovers will fall in love with this gentle and welcoming feline. So, there are plenty of low and high impact activities for the young and elderly. Skiing isn’t the only thing Niseko has to offer; visitors and locals are spoilt for choice when it comes to activities and cuisine to enjoy in summer. |
This article first appeared in The Edge Malaysia Weekly, on Oct 21, 2013.
