HDFC Mutual Fund to raise Rs 1,500 crore for real estate
Through a newly formed category named as alternative investment funds (AIF), HDFC Mutual Fund plans to raise up to Rs1,500 crore for real estate. The asset management company will raise the money through a new division that is expected to be called HDFC AIF, according to two persons who are familiar with the matter.
An anonymous person said “The new division is likely to be run by the same team that is currently handling HDFC Portfolio Management Services.” The company, which received its licence from capital markets regulator in late 2013 for alternative investment funds, will be among the first few funds to raise money under the new category. However the tenure and structure of the fund is not finalised yet. An email query sent to HDFC Mutual Fund remained unanswered until going to press.
Through its division HDFC Portfolio Management Services, HDFC Mutual Fund has been investing in real estate which had raised Rs3, 800 crore in 2008 and deployed the amount in real estate projects across the country. Recently, it exited from Mumbai-based Runwal Group, a residential project, by selling 50 per cent in the project for Rs250 crore.
In May last year Sebi had notified the guidelines for alternative investment funds, market intermediaries established in India with the objective of pooling in capital from Indian and foreign investors for investing according to a pre-decided policy. From the earlier threshold of Rs5 lakh, now the minimum investment amount to be raised under this category has been increased to Rs1 crore, a move intended to differentiate between retail and long-term investors.
Guidelines clearly mention that these funds are expected to be close-ended with term of not less than three years and the utmost number of investors capped at 1,000 entities. Recently India’s Segregated Funds Group, Jones Lang LaSalle closed its first real estate fund, Residential Opportunities Fund-I at Rs161 crore. The funds registered with Sebi as an alternate investment fund, will invest in residential projects across seven cities including Mumbai Metropolitan Region, Delhi National Capital Region, Bangalore, Chennai and Pune.
Source: The Economic Times
AIF, Asset Management Company, Bangalore, Chennai, Delhi-National Capital Region, HDFC Mutual Fund plans, HDFC Portfolio Management Services, Jones Lang LaSalle, Mumbai Metropolitan Region, Mumbai-based Runwal Group, Pune, Residential Opportunities Fund, SEBI
