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HDFC PMS to raise $242M domestic realty fund

HDFC PMS, an arm of the HDFC Asset Management Company or HDFC AMC, will launch its domestic realty fund of Rs 1,500 crore this year, sources privy to the development said.

The fund headed by Vipul Rungta will raise the capital to invest in residential asset class. It will chase deals in top tier cities which include Mumbai, Delhi-NCR, Bangalore, Chennai and Pune, sources add.

The fund has been in the works since last year and has been waiting for an opportune time to hit the market and raise capital, said one of the sources. HDFC AMC Real Estate AIF received approval to set up an alternative investment vehicle to invest in realty asset class around one year ago.

HDFC PMS had earlier raised close to Rs 4,000 crore just before the financial crisis of 2008 and invested in projects majorly through structured and mezzanine investment structures. It has invested in projects of BCC Infrastructure, Runwal Group. Runwal’s had given an exit to the investment firm last year.

Its proposed fund is separate from HDFC’s realty fund venture HDFC Property Fund, which has been on road to raise capital from the offshore market to invest in the residential asset class in the country. The fund is awaiting closure and has raised close to $250 million for the same.

Some of the funds which have recently raised capital from the domestic market for investments in Indian real estate include Jones Lang LaSalle India’s realty fund (Rs 160 crore), India Infoline’s wealth management arm (Rs 735 crore), Indiareit (Rs 1,000 crore). Other players which are currently on road raising capital include IDFC Alternatives, which is looking to close its Rs 500 crore fund in next few months and Motilal Oswal Private Equity’s Rs 500 crore fund.

(Edited by Joby Puthuparampil Johnson)

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