Ambitious mixed-use projects featuring luxury hotels are on the development slate for Tokyu Corporation, the Japanese conglomerate which runs Tokyo’s railway lines, builds and manages real estate, and comprises the majority of the mammoth Toyku Group.
The group’s latest project, in the iconic Shibuya district of Tokyo, will see Toyku team up with LVMH-backed private equity fund L Catterton on an impressive real estate project combining retail, residential, a museum and a luxury boutique hotel which will be flagged by Asia’s Swire Hotels.
While Tokyu Group’s main business has historically been in the transport industry, namely running the Tokyu Railways Company which operates railways in the Greater Tokyo Area, it today owns a total of 225 companies and five legal entities across a range of largely consumer-facing businesses. Previously the largest shareholder of Japan Airlines Holdings, it also owns and operates the upscale Tokyu Hotels and budget Tokyu Inns business lines, having opened its first hotel over 65 years ago.
Akinori Kanayama, Tokyu's executive officer in charge of hotels and resorts, says that one of the hallmarks of its decades of success has been its ability to offer a particularly Japanese experience in its hotels. “Tourists from other countries want a local experience, so our hotels incorporate Japanese taste and sensibility,” he says.
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Tokyu Hotels was founded in 1959 as the country was opening up to global tourism, with Tokyu Group identifying an opportunity to launch international-standard hotels throughout Japan. During the 1960s, Tokyu inked its first franchise deal with Hilton Hotels, and its first few owned properties were unified under the Tokyu Hotels banner. Its debut budget project, Ueda Tokyu Inn, followed in 1973, while its first resort, Tateshina Tokyu Resort, launched in the early 80s. Tokyu Hotels, in its latest iteration, was repositioned in January 2001 as a hotel management business.
Today, Tokyu Hotels boasts around 69 hotels in Japan, while it also has three hotels overseas, with a total of 1,657 rooms, namely in Newport Beach, California; Shanghai; and Singapore. The firm set up a dedicated office in California in 2019 to complement its established East Coast office in New York City and to focus on attracting more visitors to Japan.
Its Japanese operations comprise a mix of mostly management contracts, plus four franchise properties, and six hotels managed in partnership in the cities of Tokyo, Sapporo, Sendai, Nagoya, Okinawa, Osaka, Hiroshima and Fukuoka.
Shibuya focus
Over the decades, Tokyu Corporation has become synonymous with the trendy Shibuya district, where the firm started out and still today has its head office, flanking hip occupiers such as Google. As an experienced real estate developer, with a focus on retail and hospitality, the firm has big plans for Shibuya’s future. While the area is known to tourists for its iconic Shibuya Scramble Crossing – its diamond-shaped maze of crosswalks, used by some 3,000 pedestrians at a time – it is also Tokyo’s signature commercial district with its modern retail, dining and nightclub offering. This translates into one of the city’s busiest railway stations, also marshalled by Tokyu as operators of two train lines that terminate in Shibuya.
On the infrastructure front, the firm has been working with other railway operators to relocate platforms within Shibuya Station to improve transfer routes. To make exiting the station and accessing Shibuya easier, Tokyu has also unveiled massive infrastructure investment in a vertical “urban core” for the station, that connects multi-level urban infrastructure via elevators and escalators, and a “pedestrian deck” that connects disjointed parts of the city to each other.
Tokyu’s latest plans for the district follow on from key real estate decisions to reimagine Shibuya’s two major shopping malls, both owned by the firm. Explains Kanayama: "We are a hotel operator, but we are also a developer, and we are working on mixed-use projects that will cover all of Shibuya." One of the retail sites, Tokyu Department Store’s flagship store, is making way for the Shibuya Upper West collaboration with L Catterton, featuring retail, residential, a museum and a luxury boutique hotel. Tokyu already operates four hotels in Shibuya with over 1,200 keys, and Kanayama foresees the addition of cutting-edge retail spaces to these properties as well, creating a “new shopping culture” in all of the company’s mixed-use destinations. These should attract visitors from further afield as well as locals, he suggests. "The legacy of Shibuya as a place to live is day-to-day luxury," he says.
Luxury and timeshare options
With the working title of Shibuya Upper West Project, the tie-up between L Catterton and Tokyu will be designed by Norwegian architects Snøhetta, while Swire Hotels has signed up to debut its The House Collective brand in Japan within the scheme. Dubbed as the first “true luxury hotel in Shibuya”, The House Collective Shibuya will aim to introduce its signature environmental and sustainability objectives to the project in a boutique format. “The House Collective creates elevated luxury experiences with distinctive character and a sense of style,” says Tokyu Corporation president Kazuo Takahashi. The development will also see the present Bunkamura Museum of Art, operated by Tokyu Bunkamura, moved to the seventh floor of the new scheme, completing its cultural ambitions. Adds Takahashi: “Located at the site of Tokyu Department Store’s flagship store, the new development expects to welcome diverse audiences. We believe that the project will play a key part in our vision for “Entertainment City Shibuya” and pave the way for Tokyu Group’s continued growth over the next 100 years.”
Toby Smith, deputy chairman of Swire Hotels, calls the collaboration a “proud moment” for the hospitality operator as it ventures “into new cities to bring our distinctive design and people-first approach to Tokyo”.
Yet Tokyu’s ambitions do not rest solely in Shibuya. According to hotel chief Kanayama, the firm also has a plans to expand its take on timeshare stays for the digital generation. Under the business line Toyku Sharing, part of Tokyu Hotels, the firm plans to increase consumer access to timeshare holidays, whereby residents purchasing usage rights can access a specific week for twenty years, for example, or reserve seven overnight stays annually for a fixed ticket price. While the timeshare push will initially take place in Japan, there is potential to link up with international timeshare operators, he suggests.