Tourism industry razing abandoned hotels with govt support

Courtesy of Shibukawa city government
The derelict and burned-out Hotel Koyo stands near the stone stairway that is a symbol of Ikaho Onsen in Shibukawa, Gunma Prefecture, in April last year.

Moves to demolish hotels and ryokans that have fallen into disuse in tourist resort areas are gaining momentum.

The Japan Tourism Agency this fiscal year began inviting applications for a system that subsidizes half the expenses of local governments and business operators for razing hotels and ryokan inns that are disused and dilapidated. There is an upper limit of ¥100 million per site, and subsidies are offered on the condition that the cleared land be made use of.

By the end of February, the dismantling of 34 such accommodation facilities and other buildings across the country will be completed. The cleared sites are to be redeveloped as footbaths, outdoor recreational facilities and the like, thus improving the appearance of their resort areas.

One such area is Ikaho Onsen in Shibukawa, Gunma Prefecture, famous for the long mountainside stairway that runs through town. Until recently, the old Hotel Koyo building stood beside the stone stairway, which is also lined with souvenir shops. The hotel, built half a century ago, closed about 10 years ago due to an economic slowdown and other reasons. In September 2020, there was a fire in the 8-story reinforced concrete structure, prompting tourists and others to voice complaints such as “It’s dangerous,” and “It’s spoiling the view.” Thanks to the agency’s subsidy system, the grim-looking eyesore was removed this winter.

Under the subsidy system, local governments and tourism-related corporations draw up plans to make use of the cleared sites of such disused hotels or ryokans, while owners of the land and the buildings apply for the subsidy.

In the case of the Hotel Koyo, the city government of Shibukawa applied for the subsidy, with half of the removal cost of about ¥60 million subsidized by the state.

Day-stay bathing facilities and the like are planned at the cleared site.

“Some holidaymakers said, ‘It looks like a haunted house.’ I hope the new site will become one where people gather and enjoy themselves,” said Mamoru Ogawa, 30, proprietor of a nearby store.

At hot spring resorts across the country, large-scale accommodation facilities catering to large tour groups were built one after another in the 1980s and ’90s. However, as demand shifted to facilities for individual travelers and small tourist groups, many hotels and ryokans discontinued their business when their buildings began to show their age.

The demolition of facilities that have fallen out of use is, in principle, the responsibility of the business operator. Yet many were unable to pull together the money for removal, and local governments shied away from offering support.

According to the agency, the dismantling of dilapidated onsen facilities and other buildings at 34 locations across the country, including Kameoka in Kyoto Prefecture and Soeda in Fukuoka Prefecture, is expected to be completed by the end of February.

The agency intends to continue the subsidy system in the next fiscal year, hoping that it will help hot spring resorts “remove ‘nuisances,’ thus honing themselves as tourist resorts.”

Yet location sometimes presents a problem. The subsidy application for three disused hotel buildings in Kinugawa Onsen in Nikko, Tochigi Prefecture, has been shelved. As they are located on a cliff, it is deemed too difficult to make use of the site.

Yasuyuki Iida, an associate professor at Meiji University and a scholar of economic policy, said: “The assistance will have little significance if the cleared site cannot be used. Business operators and local governments need to come up with a plan by taking a good hard look at how it will revitalize their local community as a whole.”