BlackSoil Realty Fund – I, the maiden residential real estate focused fund of BlackSoil Realty Investment Advisors, has invested Rs 26 crore ($4.1 million) in a residential project of Mumbai-based developer Gala & Ghosheh Group through quasi-equity route, the company said in a statement.
The project, being developed through a joint venture, is located in Tardeo, Mumbai and is expected to be completed by 2018.
“Currently there is no new supply of luxurious projects in Tardeo area; so this shall elicit attraction as one of the finest residency projects in a key arterial area in Mumbai. Also, this is our first investments in LLP, which is still a new investment vehicle for private equity funds,” said MP Bansal, managing partner, BlackSoil Realty Investment Advisors.
This comes soon after VCCircle had first reported that the company is deploying roughly Rs 50 crore ($8 million) across two special purpose vehicle (SPV) level deals in Mumbai.
The fund - BlackSoil Realty Fund – I - which has a target corpus of Rs 250 crore including a green-shoe option of Rs 50 crore, recently hit first close at Rs 130 crore ($21 million). The fund structure allows its limited partners (LPs) to co-invest in portfolio projects to ensure flexibility.
VCCircle had reported that the firm is backing two mid-market residential projects in Mumbai – one in Ghatkopar (a suburb in Mumbai) and the other in South Bombay.
This marks the second deal of the firm—its first transaction was a company holding level investment with Mumbai-based Sheth Developers.
It looks at sealing deals with an average ticket size of Rs 20-40 crore.
The firm, which focuses primarily on Mumbai for deals, is looking to wrap up the fundraise process by mid-2015. Once it has deployed roughly 70-80 per cent of the maiden fund, it might look at launching another realty fund.
“It is too early to comment on another fund. We will think about it once we have invested a substantial portion of this fund,” Bansal had said during an interaction with VCCircle.
The fund is promoted by Shashi Kiran Shetty, chairman and managing director of Allcargo Logistics and Gnanesh Gala, managing director of Navneet Education Ltd.
The firm has relooked at its strategy since its inception a year ago. It began as a fund seeking investment opportunities in Mumbai, Ahmedabad, Bangalore, Pune and Chennai. But its focus has shifted to Mumbai now.
It has also relooked at the nature of projects for investment. Starting with an objective to invest in real estate across different verticals, the fund has now decided to skip commercial space.
It secured capital market regulator SEBI’s nod to float its real estate fund in May 2013.
(Edited by Joby Puthuparampil Johnson)