Japan’s Sumitomo Realty Bets Big on Mumbai: A New Era for Serviced Apartments in India

By Ajjay Bhagyakar | Published by Griha Realty Source: Hindustan Times & Reuters

Japan’s leading property developer, Sumitomo Realty and Development, is making a bold and unique real estate move in India — focusing its entire expansion strategy on Mumbai and prioritising rental-managed apartments over traditional sales. Hindustan Times+1

Why Mumbai? A Strategic Bet on Growth & Stability

Mumbai, India’s financial capital, has been chosen as the exclusive target for Sumitomo’s India ambitions. The city’s robust economic activity, vital location, and strong rental demand make it an appealing alternative to other metros like Delhi, Bengaluru or Chennai, where suitable land has been harder to secure. Reuters

Executives describe Mumbai as the company’s “second growth engine”, second only to Tokyo. Unlike other international players who buy existing assets or form local partnerships, Sumitomo is developing projects from the ground up, all designed to generate recurring rental income rather than one-time sales revenue. Business Standard

Serviced Apartments: Managed, Not Sold

In a strategic shift from the conventional model, Sumitomo plans to manage and lease apartments rather than selling units to buyers. This approach is gaining traction as rental yields and premium rents in south Mumbai continue to climb — with average monthly rents nearing ₹7,30,000 for high-end units. Business Standard

This “serviced apartment” model gives Sumitomo continued control over the asset, helps maintain quality, and builds long-term cash flow — a dynamic shift compared with the typical Indian luxury housing model where developers rely on sales to end-users. aparnadecors.com

Projects in the Pipeline ( Japan’s Sumitomo Realty Bets Big on Mumbai: A New Era for Serviced Apartments in India )

Currently, Sumitomo is developing five major projects in Mumbai, including four in the prestigious Bandra Kurla Complex (BKC) — a commercial and corporate hub near the international airport. These developments are slated for completion over the next five years and will form the backbone of future expansion. The Economic Times

The company has reportedly already invested about one-quarter of its committed USD 6.5 billion India investment into these projects. The Economic Times

A New Rental-Led Narrative in India’s Real Estate Market

Sumitomo’s strategy highlights a wider trend: rising demand for professionally managed rental housing, particularly in premium segments. While local developers traditionally focus on selling luxury units, Sumitomo’s model underscores the value of rental yields in a city where demand outpaces quality supply. Business Standard

Japan’s Sumitomo Realty Bets Big on Mumbai: A New Era for Serviced Apartments in India This focused entry — concentrated in Mumbai with a rental-led approach — could influence how international developers view India’s expanding real estate market in the years ahead.