In­di­a­b­ulls’ PE Unit Look­ing to Raise ₹ 1,500 cr in Realty Fund

Co’s maiden com­mer­cial fund to have a ten­ure of 5 years with an op­tion of 2 ex­ten­sions of 1 year each

The Economic Times - - Companies: Pursuit Of Profit - Kailash.Babar@ times­

Mum­bai: In­di­a­b­ulls As­set Man­age­ment Com­pany’s pri­vate eq­uity arm is look­ing to raise ₹ 1,500 crore through its new real es­tate fund Dual Ad­van­tage Com­mer­cial As­set fund (DACA), said a top com­pany of­fi­cial.

This is In­di­a­b­ulls As­set Man­age­ment’s maiden com­mer­cial prop­erty fund af­ter rais­ing two res­i­den­tial real es­tate funds to­talling ₹ 1,500 crore over the past two years. The new fund will have a ten­ure of five years with an op­tion of two ex­ten­sions of one year each. The com­pany is look­ing to raise the to­tal cor­pus, in­clud­ing co-in­vest­ments of .₹ 500 crore, through in­sti­tu­tional in­vestors, HNIs and fam­ily of­fices.

“We be­lieve this is a good time to en­ter the com­mer­cial prop­erty mar­ket, given that most of­fice mar­kets are in the rental growth phase and the next 3-5 years will see ro­bust rental and cap­i­tal value ap­pre­ci­a­tion through cap rate com­pres­sion. In­di­a­b­ulls Dual Ad­van­tage Com­mer­cial As­set Fund is a lo- ne, Chen­nai and Hy­der­abad.

“Our com­mer­cial in­vest­ment strat­egy in­tends to pro­vide down­side pro­tec­tion through re­course to com­pleted as­set, re­turns through ex­ist­ing rental yields and cap­i­tal ap­pre­ci­a­tion on exit. The fund will tar­get to achieve higher re­turns by im­ple­ment­ing var­i­ous strate­gies like the op­por­tu­nity to bring rentals to mar­ket par­ity, repo­si­tion­ing as­set to achieve higher rentals and in­no­va­tive lever­age and tax struc­tures to plug leak­ages.” said Am­bar Ma­hesh­wari, CEO — Pri­vate Eq­uity, In­di­a­b­ulls As­set Man­age­ment Com­pany.

The fund will be targeting gross pre-tax in­ter­nal rate of re­turns in the re­gion of 1617%. The av­er­age ticket size for in­vest­ments through this fund will be in the range of ₹ 100 crore to ₹ 200 crore. The fund will look at com­menc­ing its ex­its from in­vest­ments from the fourth year fol­low­ing the con­clu­sion of fund rais­ing.

In­di­a­b­ulls AIF is reg­is­tered as a cat­e­gory II Al­ter­na­tive In­vest­ment Fund un­der the pro­vi­sions of Se­cu­ri­ties & Ex­change Board of In­dia (Al­ter­na­tive In­vest­ment Funds) Reg­u­la­tions, 2012, and has been set up as a trust. The AIF plat­form has so far raised ₹ 1,500 crore and has de­ployed ₹ 1,000 crore across res­i­den­tial strate­gies.

The fund will also be raised through this plat­form. In­di­a­b­ulls Group will be the spon­sor of the fund and In­di­a­b­ulls AMC will be the in­vest­ment man­ager of the fund.

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