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Sumitomo Corporation Explores the Optimal Solution for Logistics Facilities Through SOSiLA

Logistics is a crucial social infrastructure supporting economic activities. In response to the increasing use of home delivery services, the diversification of logistics needs, and the “2024 logistics problem” stemming from a shortage of truck drivers, the logistics industry has
reached a major turning point. For this reason, Sumitomo Corporation believes that logistics facilities, which are key to this situation, should evolve from mere storage spaces into facilities capable of realizing the management strategies of customers and contributing a comfortable and essential environment for both the workforce and the surrounding community. It is under this philosophy that “SOSiLA” was born. In this article, the General Manager of the Logistics Real Estate Business Dept. and a frontline employee discuss why Sumitomo Corporation is focusing on logistics facilities and its ideal form in the future.

  • Real Estate SBU
    Head of Logistics Properties Business Unit

    Katsuhiko Chikiri

    Joined Sumitomo Corporation in 1989. Initially assigned to the Osaka Construction Department (former name). Transferred to Tokyo in 2005, where he took charge of acquiring commercial facility funds. He started working on logistics facility development as a new business in 2011. Forming a logistics team within the Real Estate Investment & Development Department, he established the Logistics Real Estate Business Department in 2019. In 2023, he assumed the position of General Manager of the Logistics Real Estate Business Dept.

  • Real Estate SBU
    Logistics Properties Business Unit

    Rie Kawamura

    During her student years, she majored in political science within the faculty of law. With a desire to “engage in dynamic work that supports society,” she joined Sumitomo Corporation in 2020. Following her assignment to the Logistics Real Estate Business Dept., she ontributed to property development in the Kanto region. In 2022, she relocated to Osaka and is currently engaged in the development of logistics facilities in Western Japan.

SOSiLA: Based on the Themes of Sociability, Sustainability, and Individuality

Sumitomo Corporation is introducing a new era of logistics facilities with “SOSiLA.” Based on the 3 themes of sociability, sustainability, and individuality, SOSiLA involves the development of innovative logistics facilities that go beyond traditional warehouses. Starting with the inaugural project, SOSiLA Narashino Akanehama III in 2016 (located in Narashino City, Chiba Prefecture), a total of 18 facilities are currently operational, with 7 facilities under construction as of January 2024.

Logistics Facilities Created With Our Unique Sumitomo Corporation Values

Please tell us the background of how Sumitomo Corporation created SOSiLA.

Chikiri It all began with the bankruptcy of Lehman Brothers in 2008. Faced with a downturn in real estate investment, there was an urgent need to create new business opportunities. The solution was the Logistics Real Estate Business. Our concept was to develop logistics facilities as a developer and then sell them to investors. At that time, we acquired information about the sale of land adjacent to a warehouse in Akanehama, Narashino City, with which our company was involved. We contemplated whether it could be utilized as a logistics facility, and that’s how the initiative began. We began by seeking individuals with the required expertise, followed by a search for potential development partners. Through a process of trial and error, we worked to secure a sales outlet for the development properties. Eventually, we collaborated with Sumisho Realty Management Co., Ltd. to establish a listed REIT*1 as a sales channel.
From the beginning, we felt that simply building conventional warehouses would not be interesting. One of the values cherished by Sumitomo Corporation is a hands-on approach*2 . This approach involves not merely giving instructions or delegating work, but actively participating at the business site and creating something together.
Furthermore, Sumitomo Corporation’s original business is real estate, and we are the only major integrated trading company directly involved in this field. Leveraging our long years of accumulated expertise, we aim to create logistics facilities that are unique to Sumitomo Corporation and nurture them into the next significant pillar of our real estate business. The logistics facility brand “SOSiLA” was born from a rigorous hands-on approach and our efforts to explore the ideal logistics warehouse format together with our development partners and other stakeholders.

*1 REIT: Real Estate Investment Trust (A financial product that invests funds collected from investors in real estate, distributing rental income and profits from real estate transactions as dividends to investors.)
*2 Hands-on approach: In the context of Sumitomo Corporation’s business, this refers to getting deeply involved in the management of invested or acquired companies.

Numerous Innovations That Exceed the Expectations of Customers and Workers

What are the features of SOSiLA and how does it contribute to solving problems in the logistics industry?

A workplace environment that prioritizes employee comfort
A pocket park

Chikiri We propose SOSiLA logistics facilities as a means to precisely address challenges and requests related to customers’ logistics. We handle many Build to Suit (BTS) projects specifically to individual customer needs. At SOSiLA Osaka (Fukushima Ward, Osaka City), we repurposed a former factory site of a major paper manufacturing company with whom Sumitomo Corporation has done business in the past. Through an equivalent exchange, they continue to use a portion of the facility for storage and research facilities, while the rest is leased out by us. Our distinctive strength lies in offering various schemes that contribute to effective utilization.
Furthermore, beyond the aspects of logistics efficiency, safety, and Business Continuity Planning (BCP), we believe that we can contribute to solving various issues such as the chronic labor shortage in the logistics industry and improving the workplace environment for workers.

Kawamura Geographically, many of our facilities are strategically located close to city centers, serving as ideal hubs in the supply chain and enabling efficient distribution. Proximity to densely populated areas ensures easy access to a workforce, contributing to the stable operation of the facilities.

Chikiri We also have an unwavering commitment to creating workplaces that are attractive for employees. The facilities include lounges adorned with art and powder rooms, providing a comfortable working environment that has received favorable feedback from the management. We believe that fostering a sentiment among employees of wanting to work there for a long time contributes to the overall enhancement of the quality of our logistics warehouses.

Kawamura We also value coexistence with local communities. To create facilities that are cherished by the community, we open up parts of our premises for the enjoyment of nearby residents, including the installation of footpaths and pocket parks for families. At many of our locations, we have also established agreements with local authorities to utilize our facilities as disaster prevention centers during times of emergencies.

Chikiri Furthermore, by leveraging our comprehensive capabilities as an integrated trading company, we can offer our proprietary systems unique to our company. Our Logistics Business Dept. manages a real-time progress management software called “Smile Board Connect,” which enhances operational efficiency by visualizing warehouse activities.

Leading the First Japanese Implementation of Smart Glass at a Logistics Facility in Her Second Year With the Company

As a young employee, what was the most memorable part for you, Kawamura?

Kawamura I can’t forget my second year at the company when I took charge of SOSiLA Chuo Rinkan, one of the largest SOSiLA facilities. During that period, the idea of introducing U.S.-made smart glass to optimize natural light intake and reduce power load emerged. This technology had never been implemented in Japanese logistics facilities, and the associated costs were substantial. However, when I consulted my team leader, he simply said, “Let’s do it your way. I’ve got your back.” From verifying its effectiveness to negotiating prices with domestic distributors and holding meetings with on-site installation companies and U.S. smart glass manufacturers to address technical challenges, I took the lead. When we finally managed to implement it, it was hugely satisfying.

It sounds like each employee is given a lot of discretion.

Kawamura That’s right. The development team that I belong to in Osaka consists of only 4 members. However, this gives each individual the freedom to think, act independently, and provide assistance when needed.

Chikiri In the Logistics Real Estate Business Dept., there are 4 project development teams, as well as quality management teams and leasing teams responsible for attracting tenants. Additionally, many of the members also concurrently serve on the innovation team, exploring topics such as digital transformation (DX) and carbon neutrality. By putting members who drive the projects on the same team, we promote cross functional collaboration, ensuring that perspectives from development, leasing, and management are shared to prevent siloed approaches. I would like to create an organization where members with diverse personalities, such as Kawamura, take on the challenge of creating new value by anticipating change and working together to co-create new logistics.

Hands-on Work That Is Needed by Society

Please tell us about your future goals and ambitions.

Kawamura I joined Sumitomo Corporation because I wanted to do a job where I could feel a tangible impact and contribute to society. My current role is precisely that kind of hands-on work. From acquiring land to leasing after the facilities are established, I am responsible for overseeing the entire process until the end. Moving forward, I will continue taking on the challenges of facility creation with this approach. I hope to contribute to our customers, and beyond that, to help address the challenges faced by the Japanese logistics industry.

Chikiri We have been carrying out development at a pace of 3 facilities per year so far. Moving forward, our immediate goal is to further expand our presence domestically, pushing for an annual development scale of 65 billion yen in assets. In the future, we believe the next step is to explore new assets beyond the existing framework of logistics facilities by developing industrial bases, such as data centers, factories, and research and development centers.


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