Source: ET 20/03/2014
IDFC Alternatives, a wholly owned subsidiary of IDFC Limited has raised its first Rs 750 crore through its first fund focused on residential sector in India, a progress that marks a precautious return of risk capital to the country's stressed real estate market.
The maiden real estate fund - called the IDFC Real Estate Yield Fund - will invest Rs 60 to 80 crore and gross target of 22 per cent returns. The four year (extendable by one year) close-ended private equity fund will invest in projects in prominent locations across six cities in India including Delhi, Mumbai, Chennai, Bangalore, Hyderabad and Pune.
"This is our first real estate fund and we feel confident about its performance. The real estate sector is going through a tough phase in the backdrop of a market slowdown and most developers are stretched with reduced cash flows. We will not invest in speculative markets," says M.K. Sinha, Managing Partner & CEO, IDFC Alternatives. The firm is looking to step up presence in the country's real estate sector.
IDFC Alternatives, one of the largest multi-asset class fund managers with a corpus of Rs 14,414 crores, managed to raise the money from domestic investors within short span of 10 weeks. "This is the right time to plough money into the sector and structure transactions that will provide high yields going forward," says Sinha.
IDFC Alternatives, a wholly owned subsidiary of IDFC Limited has raised its first Rs 750 crore through its first fund focused on residential sector in India, a progress that marks a precautious return of risk capital to the country's stressed real estate market.
The maiden real estate fund - called the IDFC Real Estate Yield Fund - will invest Rs 60 to 80 crore and gross target of 22 per cent returns. The four year (extendable by one year) close-ended private equity fund will invest in projects in prominent locations across six cities in India including Delhi, Mumbai, Chennai, Bangalore, Hyderabad and Pune.
"This is our first real estate fund and we feel confident about its performance. The real estate sector is going through a tough phase in the backdrop of a market slowdown and most developers are stretched with reduced cash flows. We will not invest in speculative markets," says M.K. Sinha, Managing Partner & CEO, IDFC Alternatives. The firm is looking to step up presence in the country's real estate sector.
IDFC Alternatives, one of the largest multi-asset class fund managers with a corpus of Rs 14,414 crores, managed to raise the money from domestic investors within short span of 10 weeks. "This is the right time to plough money into the sector and structure transactions that will provide high yields going forward," says Sinha.
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