PE Funds Earning Good Returns on Investment on Exiting
Contrary to popular perception, especially when the real estate market is showing clear signs of sluggishness, private equity (PE) funds have been exiting their investments and making good returns. A recent report by Brookfield Financials revealed that, until March 2014, nearly a fifth of the total institutional private equity was exited by PE funds.
Principal head of capital markets at Red Fort Capital, Sourav Goswami, said this trend will only grow stronger in the second half of the year. He attributes this growing trend to renewed interest in India and keenness among existing stakeholders to exit.
Managing director of Capital Markets at Jones Lang LaSelle said India fares better in comparison with other property markets. The important factor in this revelation is just whether the PE funds earned good returns on their investments or not.
With a new, stable government in place, confidence is now on the rise among high net-worth individuals and institutional investors. The expectation is that more positive exits will occur. Now it’s just a matter of the government taking bold and defined policy measures and lowering interest rates to attract more foreign capital in the country.
PE funds have been increasing their investment in the real estate sector, primarily in hopes of an improving economy. Comparing the first quarter of 2014 with the same time last year, private equity investments have increased by as much as 2.3 times, revealed property consultant Cushman and Wakefield.
Source: The Economic Times
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