HDFC Property Fund Invests .₹ 500 cr in Lodha
REVIVED INTEREST IN REALTY Lodha may use funds for its 88-acre residential project being developed in Mumbai suburb
Saikat Das & Kailash Babar
Mumbai: Private equity player HDFC Property Fund has invested about .₹ 500 crore in realty firm Lodha Developers, in what some say could be an early sign of revival in the real estate sector, where reform measures like Real Estate Regulation and Development Act and GST are helping improve transparency. Mumbai-based Lodha Developers has availed a new credit line for “72 months” at a competitive rate, which could well be in double digits, a person with the direct knowledge of the matter told ET, adding that it plans to use the funds for its residential project being developed on an 88-acre land parcel in Thane. HDFC Property Fund, backed by Housing Development Financial Corporation, is one of the largest private equity real estate funds in the country which invests in residential, commercial and mixeduse projects. An email query sent to HDFC remained unanswered till the time of going to press on Wednesday. A spokesperson for Lodha group declined to comment. Lodha Developers had bought the Thane land parcel from Calriant Chemicals (India) in 2014 for .₹ 1,154.25 crore. Last year, the realty firm sold over 2,000 homes in this project prior to its proposed launch. The value of the booked apartments was over .₹ 1,600 crore.
The project will be developed in multiple phases, with the current
one comprising 3,500 apartments with one- and two-bedroom units housed in 27-30 storeyed towers around a master-planned development. “Such transactions de- monstrate confidence on the growth of the industry,” said Ajai Kapoor, founder of 360 Degrees Real Estate Services. “With reforms like RERA and GST, the future looks bright for the (real estate) industry. There will be higher demand due to these reforms, yielding good returns against any investment being made now.”
Large developers have been turning to private equity funds after banks began curtailing credit to builders a few years ago owing to higher risk.
In May, Lodha opted for a loan of about .₹ 1,800 crore from Piramal Fund Management, the financial services arm of Ajay Piramal-led Piramal Group.