Independent fund managers find difficult to raise capital
Bangalore- Many real estate-focused fund managers are coming up with their own ventures and are developing clear fundraising strategies to convince the investors.
Bani Banerjee, former executive director and chief investment officer of TCG Real Estate, who has recently set up an advisory and asset management company, India Global Inc. Pvt. Ltd., said that not only raising capital is difficult but investing is far more difficult, particularly in the present scenario.
Several other fund managers are also following new transparent kind of approaches instead of the traditional method of raising capital, said property analysts.
Since many of the Indian developers are stressed with slow sales and increasing debts, it has been difficult for newly formed independent fund managers in raising funds for them.
Earlier large organizations usually took six-eight months time to raise a fund, whereas now, they need at least one year to raise the same amount of funds.
Investors do not wish to risk their investment fund managers. So the only option for new fund managers is to follow a co-investment model and raise capital only after identifying a project.
Few new entrepreneurs dropped fund-raising plans and are focusing on consulting or advisory work.
Another fund manager, who headed the India chapter of a global fund till last year, alleged that business has been very slow. He said that though they have finalised four deals they are expected to take time to get closed.
CBRE’s Kumar cited that owing to the difficulties in fund-raising, the sizes of funds are also thinning. He added that, it is a good thing that investments are becoming selective since it ensures that funds will go into high quality projects.
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Bangalore, CBRE, Debts, Entrepreneurs, fund managers, Fund raising, India Global Inc. Pvt. Ltd., Indian developer, Investors, slow sales, TCG Real Estate
