Mumbai-based alternative asset manager, Edelweiss Alternatives has closed the second transaction from its commercial office segment-focused vehicle, Rental Yield Plus, with the acquisition of an asset in Bengaluru.
The category-II alternative investment fund, which is still in fundraising process, has a target corpus of Rs 5,000 crore.
The fund, Edelweiss Rental Yield Plus, has now invested about Rs 1,500 crore for the acquisition of the stake owned by MMTP Projects Pvt Ltd in Bengaluru’s Manyata Tech Park. The former’s stake comprises assets spread over an area of 1.1 million square feet within the tech park.
This is the second transaction from the fund, with the first investment in a Gurugram-based office park, with an operational area of about 700,000 square feet. While details about the asset’s developer were not disclosed, this acquisition was closed in last June for about Rs 1,000 crore.
The fund’s mandate is to offer investors predictable returns in the form of annual yields along with capital gains arising from property value appreciation and value enhancement, according to a press statement.
“The MMTP PPL acquisition is a significant milestone for our RYP fund, as the asset has a proven track record of marquee tenants, high occupancy, and strong rent growth,” said Gautam Hora, the managing director of the Rental Yield Plus Fund at Edelweiss Alternatives.
According to ratings agency ICRA’s report from March 2023, the asset, then owned by MMTP Projects, has a favorable tenant profile with companies like NXP Semiconductors, Monsanto, Table Space and Philips.
“The high quality of mixed- use development with Grade-A office space, including a retail wing with F&B outlets and favourable location resulted in healthy demand for the property in the micromarket. It has lease agreements with reputed multi-national companies (MNCs),” it said.
The alternative asset manager also operates a similar strategy in the infrastructure space, called Edelweiss Infrastructure Yield Plus. Currently, Edelweiss Alts is raising capital for the second fund in this strategy, which, as of March, raised about Rs 8,000 crore.
The alternative asset manager has assets under management valued at about $6.3 billion as of December. This includes asset classes such as private credit and real assets, raising capital from limited partners including pension funds, insurance companies, large family offices and ultra-high net-worth individuals.