HDFC Property Fund aims to raise $500 mn from overseas investors

HDFC Property Fund, the accurate property funding arm of India’s biggest mortgage lender, is making plans to begin elevating $500 million from remote places traders, almost years after it turned into at first deliberate.

The fund first desired to go out its in-advanced investments and return cash to buyers before raising the price range. Separately, discern Housing Development Finance Corp. Ltd (HDFC) is firming up plans to invest in distressed real estate assets when the arena is in an extended slowdown.

HDFC Property Fund plans to invest in commercial workplace tasks and residential tendencies in pinnacle belongings markets through equity and equity-based equity widgets from the new $500 million funds.

“The fund’s life expectancy is around ten years, and so it’s lengthy-term, patient capital that we can invest in,” stated an agency government official who didn’t want to be named.


This will be HDFC Property’s third offshore fund after raising a $750 million fund in 2007-08 and a $350 million fund in 2014-15. The second fund has been almost wholly deployed. The fund has dedicated its investors to completing the exits from the primary fund and returning capital by 2018. Out of 14 investments it made from the first fund, it has exited ten up to now, and the closing four are expected to be concluded this year, he said.

The executive stated that HDFC Property recently exited Rs420 crore funding in Kalpataru Group’s underneath-construction challenge in Thane with around Rs1,172 crore.

HDFC vice-chairman and leader of government Keki Mistry said the selection to invest in distressed assets is because real property is a place of middle competence for the employer.

“We see possibilities in the real property zone. The investments can be in a fund or maybe a company shape,” Mistry stated. He declined to comment on the quantum of investments on the way to be made.

HDFC can also invest around $500 million in distressed actual property assets, said a person familiar with the development, inquiring for anonymity.

On the real estate funding front, HDFC Capital Advisors Ltd additionally raised $550 million in December in an initial closure of its 2d less costly housing fund.

In lively deployment mode, the fund had Abu Dhabi Investment Authority (ADIA) as considered one of its essential buyers.

In February, Prestige Estates Projects Ltd. jointly introduced a partnership with HDFC Capital to create a lower-priced housing platform and invest Rs2,500 crore in low—and mid-income residential projects.

Mint reported on 23 January that IIFL Asset Management Ltd plans to raise its first offshore low-priced housing fund of as much as $500 million within the subsequent financial year.

While fund-raising for actual estate initiatives hasn’t been clean, elevating capital from offshore investors has constantly been more challenging given that many vintage budgets of 2005-06 didn’t generate good enough returns.

“The new regulatory and taxation regime, with RERA and GST, has an elevated stage of transparency and a degree playing area expected in actual estate. Despite the slowdown within the sector, buyers agree with the high demand for residential projects and spot an opportunity to make investments,” stated Shobhit Agarwal, managing director and CEO of investment banking firm ANB Capital Advisors Pvt Ltd.

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