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Japan's Sumitomo Realty and Development is deepening its India presence by concentrating investments entirely in Mumbai and prioritising a rental-led serviced apartment strategy over outright home sales. Viewing Mumbai as its second growth engine after Tokyo, the developer is pursuing ground-up construction in prime locations amid land scarcity and rising rents. Unlike peers partnering locally or acquiring ready assets, Sumitomo is backing long-term rental income through managed residential and office assets. With five ongoing projects in Mumbai, including four in Bandra Kurla Complex, the company sees sustained demand, lower construction costs compared with global cities, and stable cash flows to support future expansion.
Japan's Sumitomo Realty and Development has outlined a distinct India growth strategy centred exclusively on Mumbai, with plans to expand its portfolio through owned and managed properties rather than selling residential units. Advertisement
The Tokyo-headquartered developer views Mumbai as its second growth engine after its home market, citing the city's economic vitality, depth of corporate demand and long-term rental potential. Company executives indicated that Mumbai's land constraints create favourable conditions for sustained rental growth, making it more attractive than other major Indian cities at present.
Sumitomo is currently developing five projects in India, all located in Mumbai. Four of these are in Bandra Kurla Complex, one of the country's most prominent commercial districts near the international airport. These projects are expected to be completed over the next five years, with rental income from completed assets intended to fund further expansion.
Unlike many domestic developers that monetise luxury housing through outright sales, Sumitomo plans to retain and manage apartments, including serviced residences in super-high-rise developments. The approach mirrors its Tokyo model, where it manages a large portfolio of office and residential buildings.
The company has already deployed about a quarter of its committed USD 6.5 billion investment earmarked for India. Rising premium rents in south Mumbai, alongside comparatively lower construction costs than global financial hubs, are reinforcing Sumitomo's confidence in a long-term, rental-driven strategy in the city.
Source - Reuters
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