Horiemon Joins the Buzz as Louis Vuitton Opens with Hourly Wage ¥2,000 in Niseko, the Elite’s Hub

The snow quality is great, but,

Niseko, Hokkaido, known as an international ski resort, is getting hotter and hotter with the first winter season after the COVID-19 crisis. Last December, a Louis Vuitton pop-up store opened in the Park Hyatt Niseko Hanazono. Diageo Japan, a subsidiary of a major British brewing company, opened an ice lounge serving high-end tequila and other beverages on the site of the former Hotel Niseko Alpine.

According to the Hokkaido Shimbun, many hotels and condominiums in the Niseko area, consisting of Kutchan and Niseko towns, reported an increase in accommodation bookings in December 2023 compared to the same period the previous year. Mr. Yoshito Tanaka, who is involved in ski rental and car rental businesses in Kutchan and served three terms as a member of the town council until March of last year, also mentioned this trend.

“After the relaxation of border controls last season, it was said that about 70% of tourists returned. However, this season is showing momentum surpassing the pre-COVID era. In December, accommodation facilities were fully booked everywhere. Last winter, many hotels operated at about half capacity due to a shortage of staff, but this season, they secured staff early and are operating at full capacity.”

Hourly wages in Niseko have been rising even before the ski season began, and looking at various job sites, wages of 1,500 yen per hour are not uncommon. Some of the jobs are paying over 2,000 yen per hour.

“The Sukiya beef bowl restaurant, which opened in Kutchan Town in December last year, pays 1,650 yen per hour during the day and 2,088 yen at night.”

Without raising hourly wages to that level, it would be impossible for any industry in Niseko to secure the manpower it needs, but at the same time, new lodging facilities continue to be built to provide employment opportunities.

“In December 2022, a condominium-style hotel called Setsu Niseko opened in the Hirafu area of Niseko, and in December of last year, another one named Mowa Niseko opened. Both developments are led by foreign investors.”

At the World Ski Awards 2023, which honors excellent ski resorts worldwide, Setsu Niseko was selected as the Best New Ski Hotel. Checking the accommodation prices for late January, a 1-bedroom suite (for 4 people) costs 532,200 yen for a 3-night stay, equivalent to 177,400 yen per night.

At the World Ski Awards 2023, Haku Villas, which opened in the Niseko Hirafu area in 2019, also received the Best Ski Boutique Hotel award. The penthouse here costs 35 million yen for a week’s stay.

“Seasons Niseko, a detached condominium in Annupuri, Niseko Town, offers stays from 5 nights. With an indoor hot water pool and an in-house chef, it costs 26 million yen. I heard that Vietnamese travelers added various options and stayed for 30 million yen.”

Evening traffic jams and a shortage of restaurants lead to a dinner crisis

Niseko has become a hub for luxury condominiums. However, according to Mr. Tanaka, Niseko’s accommodations do not offer sufficient hospitality.

“First-class hotels in overseas resorts have properly trained staff. In Niseko, there are hotels like Park Hyatt, Hilton, and Ritz-Carlton, but due to a shortage of manpower, including these 5-star hotels, the situation seems to be that they are scrambling to gather staff, leading to a lack of well-trained employees.

Resorts that are accustomed to accommodating guests might receive harsh evaluations from travelers familiar with staying in such places if the service provided does not match the amount paid, as education for employees appears to be lacking.”

Niseko was selected as one of the top 10 destinations for 2024 by American Express travel consultants based on cardholders’ travel bookings, along with Zermatt, one of Switzerland’s most popular mountain resorts. It seems that Niseko is attracting a lot of attention from well-traveled foreigners.

“With the branding of Niseko, coming to Niseko has indeed become a status symbol, especially for people in Asia. At our shop, there has been an increase in Asian customers renting ski equipment and wear, with many of them being beginners. Some of them wear ski wear, hold skis, stand on the slopes, take a photo, and that’s it.

The reason VIPs from around the world gather at luxury ski resorts in Europe and North America is because they offer that level of quality. Saying this might upset locals, but unfortunately, Niseko does not yet have the quality of a world-class resort area.”

One of the reasons for this is the traffic situation, Mr. Tanaka said. During the winter season, he says, the main roads around the Niseko Hirafu area are jammed with traffic.

“There is a free shuttle bus circulating within the area, but due to insufficient public transportation, many tourists use rental cars. Therefore, during the evening hours from 4 to 6, traffic congestion is severe. It takes about 30 minutes to cover a distance of 1.5 kilometers.

However, even for renting cars, the number is insufficient. Taxis also have a limited fleet, with only around 30 vehicles running, a mix of local and dispatched vehicles from places like Sapporo. Perhaps due to this inconvenience, I’ve heard there are unofficial taxis operated by foreigners for other foreigners.”

Rental cars and cabs are not the only vehicles in short supply. There is also a shortage of restaurants.

“The total number of beds in the accommodations in the Hirafu area is currently around 13,000. The total number of seats in all the restaurants covered in the ‘Wine & Dine’ guidebook for this area is about 2,500. There may be guests preparing meals in condominium kitchens, but there is an absolute shortage of restaurants. Every night, there are occurrences of dinner refugees.”

Perhaps seeing a commercial opportunity in the shortage of restaurants in Niseko, about 50 kitchen cars, more than twice as many as the previous year, have gathered in the Hirafu area this winter from all over Hokkaido, operating with the permission of the landowners.

“There are kitchen cars selling sushi made by foreigners imitating the art, priced at 1,500 yen per piece, and others selling onigiri with salmon roe for 2,000 yen each. On the other hand, some operators are setting the location fee for setting up a kitchen car at 1 million yen for a season.

 Speaking of which, a ramen shop produced by Takanori Horiemon Horie opened next to us on New Year’s Eve last year. It’s a 3-square-meter store converted from a shipping container in the food street, and a bowl of miso ramen is priced at 2,500 yen. It’s quite a bold price.”

There is probably no other ski resort in the world where kitchen cars line the streets.

“Restaurants are crowded everywhere, and it’s hard to get a seat. It’s also a struggle to move around the resort. Even if Western ski tourists say, ‘The snow quality is the best,’ there’s nothing we can do.”

To preserve the skiing culture of Niseko and maintain its brand strength, efforts are being made not to diminish the brand’s appeal

Tourists have been asking for something to be done about transportation within the resort.

“The only solution, in my opinion, is to regulate the entry of cars into the resort area. With the upcoming opening of the Hokkaido Shinkansen Kutchan Station, development around the station will begin. Along with this, parking lots will be developed around the station, allowing visitors to leave their cars in the city area. Additionally, transportation methods from the city to the resort area will be provided.

Although shuttle buses connecting the four ski resorts and buses between the city and the resort area already exist, their operations are struggling to keep up. Limited availability of drivers and strict regulations pose challenges for bus companies. Considering the 2024 problem, relying solely on buses is no longer realistic. Therefore, alternatives like installing a new ropeway could be explored. By securing land for building towers, it is the least labor-intensive and budget-consuming option.

Restricting the number of cars entering and collaborating with tourist bus companies to establish a secondary transportation network within the resort can provide flexibility for tourists to access any location by bus. 

Connecting the resort area and the city with a ropeway could also help alleviate the issue of insufficient dining options. Ski enthusiasts going to the city and using local restaurants may increase, contributing to a resolution of the problem of restaurant shortages.”

If steps are not taken now, Niseko will not be a sustainable resort. Mr. Tanaka believes so.

“The brand power of Niseko is beginning to show signs of fading. I’ve spoken to various people, and there are voices saying, ‘Niseko is done.’

 If the situation continues with wealthy Asians who don’t have skiing experience flooding in, the skiing and snowboarding culture of Niseko could disappear. If the affluent and advanced skiers from Europe and the United States, who know resorts around the world, start to drift away, the brand power will decline. To prevent that from happening in Niseko, I’m working together with local enthusiasts to think and act on various initiatives.”

We hope that Niseko will continue to be the ski resort of choice for American Express cardholders.

Yoshito Tanaka, Representative Director of Niseko Resort Service Co., Ltd., was born in 1972 in Sapporo. After graduating from Kutchan High School, he pursued a career as a freestyle skier (mogul) and participated in events such as the Europa Cup and All Japan Championships. After working for automobile sales companies and foreign financial institutions, he returned to Kutchan in 2003 and established the company in 2007. The company is involved in ski rental, car rental, real estate leasing, and other businesses. He served as a member of the Kutchan Town Council from 2011 to 2023 for three terms.