Sumitomo Forestry America, Inc., through its U.S. Eastern Seaboard stronghold

Source: company materials

The Florida puzzle-piece gives Sumitomo Forestry Group’s Sun Belt states operational presence and game-plan potent growth opportunity at a time the company’s North America strategy calls for aggressive growth. Five Sumitomo affiliate operators – Bloomfield Homes, Brightland Homes, DRB Group, Edge Homes, and MainVue Homes – together delivered 10,221 homes in 2023, which would have made Sumitomo one of the nation’s top 15 single-family builders.

Company projections call for 15.3% growth in full-year 2024, to a total of 11,785 homes, and adding Florida to its 11 other states gives the enterprise a boost to reach that goal. As we have reported – although Sumitomo has proven it is nothing if not an astonishing case-study in long-term planning and strategy – the Osaka-based company’s stated ambition for a decade or more has been to rise to a leadership level among U.S. homebuilding and development enterprises, setting 23,000 annual deliveries as a medium-term goal.

Together, Sumitomo, Sekisui House – which in January unveiled its blockbuster $4.9 billion deal to acquire MDC Holdings – and Daiwa House, have already altered the balance of power in the U.S. enterprise homebuilding business. Along with Knoxville, TN-based Clayton Homes, and a few Canada-based real estate players, Sumitomo, Sekisui House, and Daiwa House are on the short-list of any strong private homebuilding operator in the U.S. with a mind to sell now.

In many respects, 300-plus-year-old Sumitomo’s road-map to 2030 reflects the most vertically-woven strategic game-plan – ranging from forestry and forest products, to mass timber construction, to cabinet manufacturing and supply chain solutions, to truss and wall panel manufacturing facilities, to horizontal land engineering and development, to multifamily apartment development and construction, as well as its single-family portfolio of companies.

The grand plan, per Sumitomo Forestry Group’s press statement, paints a picture of blue sky business ambition, purpose, and customer focus:

The Sumitomo Forestry Group is engaged in a broad range of businesses revolving around wood, including forest management, timber and building material procurement and manufacturing, wooden construction including single-family home and real estate development, and wood biomass power generation. Through the Sumitomo Forestry Wood Cycle, an element of our long-term vision for 2030 “Mission TREEING 2030”, we are striving to increase the CO2 absorption of forests and store carbon for long periods of time with the popularization of mass timber buildings to contribute to decarbonization for the company, customers, business partners, and society. With the advancement of globalization being one of its long-term vision business policies, Sumitomo Forestry is also working to accelerate decarbonization initiatives in USA as well.”

It’s exactly this level of ambition – and the fact that, typically, Japan-based acquirers regard the local leadership of their U.S. operating affiliates as true strategic partners – that appealed most to Stern and his co-managing members, including David Adler, a long-time Florida homebuilder.

We’ve made it our business over the years to develop places and build homes that stand out among our buyer and resident customers as homes they love to come home to, and feel a sense of sanctuary and comfort,” Eduardo Stern tells us. “This is the biggest investment most of them ever make in their lives, and we feel personally accountable to make them feel they’ve invested well and continue to gain value in our homes. The Sumitomo team gave us the sense and showed us evidence that they mean it when they say they believe 100% in the same thing.”