ASK Property Investment Advisors, the real estate private equity unit of ASK Group, and TVS Emerald Haven Realty Ltd have set up an investment platform to back residential projects of the property development arm of TVS Motor Company.
The partners will jointly invest Rs 400 crore ($62 milllion) in affordable and mid-segment projects, ASK Property said in a statement.
The first investment under the platform, of Rs 83 crore, has gone to a project of TVS Emerald at Porur, Chennai. The 10-acre project has a saleable area of 5,48,000 sq ft.
Amit Bhagat, managing director and CEO at ASK Property, said that the affordable and mid- segment market offers huge growth potential and that the collaboration leverages each partner’s strength.
TVS Emerald builds houses for mid-income groups and has delivered one project in Chennai. It is developing five more projects in and around the city and plans to expand to Bangalore in the near future.
ASK Property has raised funds from both offshore and domestic investors across funds. It mobilised Rs 326 crore between March 2009 and December 2009, a difficult time for fundraising. It raised its second domestic fund of Rs 1,000 crore in 2011 and a third local fund of Rs 1,400 crore in 2016.
Separately, ASK Group mopped up Rs 550 crore for its maiden offshore fund and structured debt of over Rs 575 crore for developers.
The firm recently decided to invest in commercial real estate projects and backed a mixed-use project of north India-based developer ATS Infraprojects. The PE firm is bullish on commercial real estate given the momentum in the segment and is likely to float a commercial fund.
Platform deals have become the norm for global and domestic investors to seal deals in the Indian real estate market. A platform transaction allows an investors to back a bunch of projects in one go, saving time on multiple rounds of due diligence.
As previously reported by VCCircle, Motilal Oswal Real Estate, the real estate investment arm of Motilal Oswal PE, had struck a platform deal with Chennai-based developer Casa Grande for investments in residential projects.
Global investors have led the trend in sealing such transactions in the realty market. Canadian Pension Plan Investment Board (CPPIB) has struck deals for industrial and retail assets in India with IndoSpace and The Phoenix Mills, respectively.