Realty focused Private Equity firms are raising funds
The real estate sector in India will witness a flow of new or follow-on private equity (PE) funds in the market. Though funds launched last year found it tough to raise money, 2012 has seen more firms jumping on the fundraising program.
According to data it is seen that PE deals in realty have come down drastically in 2012 so far, but the Private Equity firms are aiming to launch new fund raising scheme.
It is found that the old funds are trying to raise their second fund. IL&FS Investment Managers, Anand Rathi-Knight Frank, JP Morgan Partners, ASK Investment Advisors, Azure Capital Advisors, Lavi Real Estate Advisors are some of the firms in fundraising mode.
Returns have been a function of years of investment. For instance, most funds have earned returns in excess of 25 per cent from their investments in 2005, 2006 and 2009. On the other hand, investments from the year 2007 and 2008 will significantly underperform and in some cases, investors will lose money.
But the poor market conditions and non-availability of bank loans have squeezed real estate developers, and PE has emerged as an alternative source of funding for the real estate in India.
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Source: Business Standard
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