Reaching the Heights of Luxury through Smooth Project Management:
The Ritz-Carlton, Nikko

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With a long-term rise in tourism demand, the development of luxury hotels and resorts in Japan has become increasingly attractive to real estate investors and developers in Japan and abroad. However, compared with office and commercial facilities, foreign-owned luxury hotels are viewed as an asset class within the real estate industry that is particularly difficult to get into, requiring highly-specialized planning and intricate coordination with numerous stakeholders. The roles of overseas-based hotel operators and interior designers are also crucial and require the ability to organize project teams based on premises that may not be common practice in the Japanese construction industry. Over the years, we have been involved in a number of project management endeavors for the development of hotels on an independent basis in order to support our clients, hotel owners. One such example is The Ritz-Carlton, Nikko, located in a national park on the shore of Lake Chuzenji, which we designed together with our client.

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How to achieve a delicate and authentic design

The construction of The Ritz-Carlton, Nikko was the very first overseas luxury hotel project for our client, Tobu Railway. For this reason, they needed assistance with project management to anticipate challenges and ensure that the project could move forward. We first selected Australia-based LAYAN Design following a design competition involving several world-class interior designers with the goal of creating a space that offers a world-class experience for guests with a sense of Japanese beauty. LAYAN Design offered a sophisticated take on Nikko’s traditional culture and local character, and using authentic materials, presented a simple and intimate spatial composition with subtle details to create a fresh design never seen in Japan. However, the realization of these designs was far from easy because recreating such craftsmanship requires the heavy use of natural materials and specially-customized construction methods. However, the Japanese construction market, which is dominated by streamlined standards and industrial materials, can be several times more expensive than China and Southeast Asia. Hotel projects also require expertise in different areas, including architectural design, facilities and equipment, kitchen design, signage, background music, IT, art, furniture and fixtures, as well as interior design, and many segments are handled by different design and consulting firms. Because of this complexity, proper management is needed to bring all these elements together. And, since these are “luxuries”, there is no upper limit to quality, making controlling costs one of the biggest challenges.

Image of the project structure

Balancing cost management with an understanding of the value that must be achieved

It was important to assess and prioritize the value of each item, both individually and in total, always comparing the space value achieved with the cost of construction in order to realize maximum value at minimum cost. However, since various elements of workmanship, such as interiors, kitchen designs, furniture and art, are intertwined and constantly changing, it was necessary to examine and analyze the data in detail over the course of the project in close coordination with all stakeholders involved. We strived to keep information accurate and up-to-date with the use of various methods, such as in numerous meetings with designers to confirm design details, building multiple versions of simulation models in Excel linked to estimates, and formulating negotiation scenarios.

“The Japanese Restaurant by The Ritz-Carlton, Nikko”, the hotel’s main restaurant offering kaiseki cuisine, sushi, and teppanyaki (photo by Nacasa & Partners)

Brainstorming and finding solutions together

In western-style project management, the main task is to identify issues, pinpoint stakeholders to solve these issues, and move ahead with the project. We, on the other hand, place value on an attitude of working together with architects and designers to find solutions to problems. This style builds a deep, trusting relationship between the many parties involved in the project and allows them to take the initiative in helping solve problems when they arise. This project also posed a number of challenges, including a sudden change in the air-conditioning system at the stage when it was moved on-site and in response to the COVID-19 pandemic, although ultimately, these issues were resolved successfully and the hotel opened without a hitch in July 2020.

All guest rooms have bathrooms with views of the vibrant greenery of Nikko (photo by Nacasa & Partners)

Managing diversity

In retrospect, we believe the three most common characteristics of successful projects are
① the insatiable desire to create something better,
②  shared values among stakeholders, and
③ a diverse team structure. 
We have taken on a leadership role in building collaborative relationships within the sometimes confrontational environment of projects that involve a number of different stakeholders, such as foreign-owned luxury hotels, and strived to achieve an uncompromisingly level of even higher quality at optimal costs. These are skills that will be needed not only in hotels, but also in countless other major development projects in the future. We want to take these core competencies and contribute to the creation of new opportunities and value through real estate.

■  The Ritz-Carlton Nikko Overview

Name ： The Ritz-Carlton, Nikko
Owner ： TOBU RAILWAY CO., LTD.
Operator ： Marriott International
Location ： Nikko, Tochigi
Guest Rooms ： 94 rooms
Interior Design ： LAYAN Design Group (Guest Room, Public Area)
NIKKEN SPACE DESIGN (Spa & Onsen)
STRICKLAND (Restaurant)
Architecture ： Nikken Sekkei
Construction ： TOBU CONSTRUCTION, etc.

Hisashi Sugimoto

Associate Facility Solution and Strategies Section Facility Solution Group, New Business Development Department
​

Hisashi Sugimoto joined Nikken Sekkei after graduating from The University of Tokyo’s Graduate School Department of Architecture in 2008. He aims to create built environments where corporate profits and social values can co-exist through project management and FM/CRE strategies.
Over the years, he has been involved in a wide range of projects as a project manager and owner’s consultant, including Hino Motors’ Koga Plant (2016), Hibiya Parkfront (2017), The Hotel Seiryu Kyoto, Kiyomizu (2020), Ace Hotel Kyoto (2020), and The Ritz-Carlton, Nikko (2020), among others. Mr. Sugimoto has extensive experience in consulting on facility strategies, including the utilization of corporate real estate assets and the development of maintenance and conservation strategies. He is a first-class architect.

Hisashi Sugimoto

Kimihide Tamada

Facility Solution Section Facility Solution Group, New Business Development Department
​

Kimihide Tamada joined Nikken Sekkei in 2018 where he specializes in project management.
Worked as an architectural designer at a boutique design firm, where he was responsible for apartment complexes, schools, commercial facilities, and medical facilities.
During his time as a designer at an atelier-type design firm, he was responsible for designing housing complexes, schools, and commercial and medical facilities. Later, he was responsible for PM/CM for luxury hotels while working at a foreign-owned development company. 
He is a first-class architect and has been involved in designs for the Four Seasons Hotel Kyoto (previous job), The Hotel Seiryu Kyoto, Kiyomizu, and The Ritz-Carlton, Nikko, among others.

Kimihide Tamada

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