This article was originally published in Housing Japan Magazine, Spring 2020 edition.
Playing the long game in short-stay property
Involved in a wide range of real estate projects, including development, sales, leasing, hotels and self-storage, Housing Japan expanded in many areas before entering the short-term rental marketplace. It’s now launching Alt Stay, a portfolio of apartments that aims to cater to young professionals using Tokyo as a temporary base. The initiative may be new, but it’s been long in development.
“When Airbnb started here”, says Housing Japan Co-founder Joe Rigby, “there was a lot of interest at Housing Japan, but the reality was that its business model at launch was never legal. If you’re running a business, you have to obey the rules and regulations. So, we said, ‘well, what can we do that looks like Airbnb, but that’s legal?’ That’s how we evolved our product to where it is now.
“As well as managing properties for customers who may be operating short-term lets, we’ve been developing a portfolio of our own, which we are letting on a daily basis with a hotel licence, and on a longer stay basis within a minpaku-style legal framework.”
Kanemitsu Takahashi, who specialises in the short-stay part of Housing Japan’s business, says the Alt Stay portfolio differs from the firm’s management of properties for individual owners.
“Needs for short-term rental apartments from both corporate and individuals have become quite high compared to several years ago. Corporate expats used to rent serviced apartments or long-term rental apartments, but there are now more young expats coming to Tokyo for short-term project work who don’t need either luxury serviced apartments or long-term apartments.
“What we are providing for these customers is the right-size, quality apartment for a reasonable price. Because of the options for remote working in various fields, we have a very mixed customer base of traders, consultants, YouTubers, designers and creative directors. We’ve even had online gaming customers rent our apartments, working while exploring a foreign country.”
Unique approach
Housing Japan’s latest offering is akin to a serviced apartment (SA) without the service, according to Takahashi.
“We do not provide on-site services like a front desk or room service, so our operation cost is lower than that of SAs and we can offer a quality furnished apartment for a lower rate than a traditional serviced apartment. Also, we try to focus on apartments of 20–50 square metres. It’s larger than a standard hotel room in Tokyo and smaller than most serviced apartments.”
Alt Stay properties are mostly in the central part of Tokyo, namely Minato, Shibuya, Shinjuku, Chuo and Chiyoda wards.
“These areas are well-populated by foreign companies, embassies and a wealth of cultural attractions. As well as being very popular for business customers, these parts of town also attract a lot of interest amongst individual, long-stay tourists,” explains Takahashi.
Different types of customer might spend very different lengths of time in their leased apartment, so design of space is important to Alt Stay’s success.
“We’ve been working with one specific partner, Umyco Design, on the interior decoration and furnishings of our properties,” says Takahashi. “We want to create spaces that are going to work for the customer, irrespective of whether they’re out all day on a project or working in the space for hours on end. Design and comfort are a crucial part of the mix when it comes to creating a nice experience for our guests.”
Platform for success
So far, the approach seems to be working, as Alt Stay continues to grow in popularity, according to Rigby.
“We currently manage about 160 rooms, and we’re looking at adding 70 rooms over the course of the next year. We are aiming to hit 500 rooms in three years and 1,000 rooms in five years.”
“As far as the Olympics is concerned,” says Rigby, “we had been receiving inquiries related to Tokyo 2020 from foreign media groups consistently for a couple of years. But, with the postponement of the Games and the situation with COVID-19, everything has changed.
“Right now, we’re keeping a close eye on the travel advice and information from the relevant Japanese government ministries, as well as our industry partners. Business travel, like everything, has been seriously affected by the pandemic and will take some time to normalise. We’re ready and there for customers when they return.”
Find out more about Alt Stay here: www.alt-stay.com
