Sumitomo Corporation Explores the Optimal Solution for Logistics Facilities Through SOSiLA

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.

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

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.

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

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

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.