With Japanese developers flocking to the booming office market, Sumitomo Real Estate (Sumitomo Realty & Development) is recently embarking on the launch of a 500 billion yen (about 33) yen in downtown Mumbai (Mumbai)..$400 million) in redevelopment projects。

The Japanese developer plans to build offices, hotels and commercial facilities on an old factory area of about 80,000 square meters.。After the completion of the project, Sumitomo Real Estate's total office space in India will reach 1.26 million square meters, which will be one of the largest real estate projects independently developed by foreign companies in India and the largest project by a Japanese developer in India.。

It is reported that Sumitomo Real Estate has signed an agreement to 46.7 billion rupees (about 5.$6.1 billion) from Bombay Dyeingand Manufacturing, a subsidiary of the Wadia Group, to buy the site in Mumbai's Worli community, with the goal of completing the project in the early 1930s.。

Statistics show that Sumitomo Real Estate has invested nearly 2,000 yen in office development at Bandra Kurla Complex, Mumbai's fast-growing residential and commercial district, and the Worli project will bring its total investment in India to about 700 billion yen.。

With the rise of telecommuting, the US office market has stalled, and the medium and long-term growth prospects for this market in Japan are bleak.。As a result, Japanese developers are shifting their focus to residential and commercial development, and the new plan highlights a shift in their attitudes towards emerging markets。

India, meanwhile, is expected to become the world's third-largest economy by 2027.。Research firm Mordor Intelligence expects the size of India's office market to expand to around $91 billion by 2028, up from 3 in 2023..5 times。

The tax reforms implemented by Prime Minister Narendra Modi since he took office in 2014 have created a more business-friendly environment, attracting a large number of manufacturers and businesses, and stimulating demand for office space by foreign companies.。Real estate investment in India surged 32% to $7.8 billion in 2022, according to CBRE.。

Sumitomo Real aims to grow India's office leasing business into a business with rental income (EBITDA) of 60 billion yen in the 2030s, and expects rental income from Japan's office business to reach about 300 billion yen.。

It is understood that other large Japanese developers are also entering the Indian market.。Mitsubishi Estate has invested in a fund set up by a Singaporean developer to build an office building in India's fourth-largest city, Chennai, by 2024.。In addition, Mitsui Fudosan has built an office building in Bengaluru and is currently working on the second phase of the project.。

In the five years to fiscal 2022, both companies "overseas assets doubled.。While Mitsui Real Estate is more focused on projects in the U.S. and Europe, such as the 600 billion yen Hudson City Plaza 50 (50 Hudson Yards), it is also becoming more active in emerging markets.。