TOKYO -- Sumitomo Forestry will market single-family homes in Indonesia, as the Japanese housing and wood products company branches out to Southeast Asia's rising middle class.
Sumitomo Forestry will form a special-purpose company in January with local real estate developer Summarecon Agung, taking a 49% stake. Investment in the business should total around 3.4 billion yen ($29.8 million).
Some 160 detached homes are to be built next spring on 44,000 sq. meters in Bekasi, a city about 25 minutes by rail from central Jakarta. The two-story houses made of reinforced concrete each will sell for an estimated 20 million yen or more. Sumitomo Forestry, which eventually intends to use wood materials it produces in Indonesia for the floors and stairs, seeks to attract middle- and upper-class consumers by offering interiors featuring a woody feel.
The Japanese company is bolstering operations in Southeast Asia, having launched development of luxury condos in the Thai capital of Bangkok in early October. It forged a tie-up with a materials processing company in Vietnam last month to tap the partner's distribution channels for selling wood materials from Japan. Sumitomo Forestry will consider taking the single-family housing business to Thailand and Vietnam as well.
Sumitomo Forestry boasts the largest overseas business among Japanese housing builders in terms of sales, ringing up 196.9 billion yen in related revenue last fiscal year.