High-End Hotels Blooming In Tokyo

A boom of high-end hotel development in Tokyo is expected to continue in 2007 and other cities and areas of Japan are seeing a rush of new and renovated properties, said national tourism and travel representatives. Occupancy continues to be strong, however, as demand from both transient corporate travelers and incentive travelers grows, they said.

The demand is fueled in part by stable air and hotel rates combined with favorable currency exchange rates, which is helping Japan attract more U.S. corporate meetings and incentives in addition to the growing volume of transient corporate travelers, said Miki Motegi-Hall, New York-based senior convention marketing specialist for the Japan National Tourist Organization.

Japanese domestic airfares are expected to increase 1 percent to 2 percent in 2007, according to a 2007 forecast report issued by American Express Business Travel. International long-haul business class fares to Japan also are expected to increase by 1 percent to 2 percent this year over 2006. For hotel rates, Amex predicted flat to up to 2 percent increases in mid-tier properties. Rates at upper-tier properties are expected to increase by less than 1 percent in 2007, according to the report.

A slew of luxury brands are building hotel properties in Tokyo, but the market is far from saturated, said Etsuko Kawasaki, a director at the Japan National Tourist Organization office in New York. Occupancy has remained steady at more than 80 percent across all tiers, despite the opening of three new luxury brands in 2006 and two more scheduled openings for 2007.

Ritz-Carlton's first property in Tokyo, which opened late last month, has views from the city's newest and tallest skyscraper. The hotel is part of a recently completed redevelopment project called Tokyo Midtown in the central district of Roppongi. The project, which also held its grand opening late last month, converted Japanese defense agency buildings into retail and office space.

The hotel, which takes up the top nine floors of the development's central tower, features 250 guest rooms, restaurants, a health club and a spa. The hotel's ballroom and function space are located on the lower levels of the tower.

Tokyo Midtown features wireless Internet connectivity throughout the entire property, and includes two halls, nine conference rooms and other venues suitable for corporate meetings, according to the developer's Web site. Within a one-mile radius, there are more than 40 foreign embassies, nine international schools, offices, art museums and a park.

The Peninsula Tokyo is set to open in September this year in the city's Yurakucho business district. The hotel will feature 314 guest rooms, five restaurants, two ballrooms, six function rooms, a spa and a fitness center. The property also claims the highest staff-per-guest ratio in the city and developers said it is the only free-standing luxury hotel to be built in Tokyo in more than a decade.

Starwood Hotels and Resorts plans to open its first St. Regis property in Japan. The hotel is expected to open in Osaka in 2009 and would offer 170 guest rooms. Shangri-La Hotels has announced plans to open a luxury property in Tokyo in 2009.

Starwood last month announced plans to add two new properties in Japan under its Sheraton brand. Sheraton has reflagged the Miyako Hotel Tokyo under its brand with 492 rooms. The Sheraton Miyako Hotel Osaka has 575 rooms.

The luxury market is in high demand in the city, especially among foreign business travelers, Kawasaki said. Though U.S. travelers seem to prefer such international brands as Ritz-Carlton and Grand Hyatt, domestic brands also are attempting to capitalize on the growing demand for high-end properties.

"Many Japanese brand hotels are renovating as well," Kawasaki said. "In April, Tokyo Prince Hotel Park Tower will be renamed The Prince Park Tower Tokyo. They are trying to standardize quality across all their properties."

Two floors of the Imperial Hotel Tokyo recently completed renovations. Rooms on the property's 11th and 12th floors now have restricted key card access for added security and are designated as nonsmoking. The renovations also included a new air quality control system. The property also features a Japanese teahouse where guests can enjoy a traditional ceremony served by attendants dressed in kimonos.

In Osaka, a new boutique hotel has opened in the city's Kita area. The Dojima Hotel is a mixed-use property with 76 guest rooms on the 8th to 13th floors. The property also is home to restaurants, leisure facilities and shops.

Spa development is also a trend among domestic brands, said the Japan National Tourist Organization's Motegi-Hall.

"They are generally constructing Western-style spas with Japanese touches and services," she said. "Renovations combine the Zen-like senses and traditions of Japan with Western tastes."

Even airports in Japan are adding facilities to capitalize on the growing demand for spas by foreign travelers. When Nagoya's Central Japan International Airport opened in 2005, it included the first traditional Japanese spa at an airport. For less than $9, travelers can enjoy a hot soak, spa and a jet bath while viewing planes, according to the JNTO Web site.

"You can take a bath and watch the planes land," Kawasaki said.

The hotel Nikko Northland Obihiro, with 170 guest rooms, opened April 1. The hotel is on Japan's northernmost island, near a lake and hot springs.

"Japan is a great destination for business incentives," Motegi-Hall said. "It has all aspects: skiing in the north and beaches in the south. People think that it's far from the United States, but the flight from the West Coast is just nine hours."

A number of hotels are being developed around the Tokyo Disney Resort area. In March, the Tokyo Bay Maihama Hotel opened as an official resort hotel. Other developments opening soon around Tokyo Disney include Mitsui Garden Hotel Prana Tokyo Bay with 550 guest rooms and Tokyo Disneyland Hotel with 700 guest rooms.

To encourage travel to lesser-known destinations in Japan, Japan Airlines and All Nippon Airways are offering a subsidized "Visit Japan" fare for foreign visitors. With proof of an international ticket into Japan on any carrier, JAL and ANA will issue a discounted one-way domestic ticket for about $100, said Kawasaki.

An expansion project at Tokyo's Haneda airport is scheduled to begin in late March. By 2010, a new runway is expected to boost capacity for takeoffs and landings to 80 per hour, up 40 percent from current levels. The project was scheduled to begin last year, but was delayed by disputes with local fisheries affected by the land reclamation needed for the expansion.