Buoyed by the recovery in the real estate sector, Indiareit Fund Advisors, promoted by the Piramal Group, is eyeing four to five partial exits this year from its large portfolio of residential projects.
One of its major exits will come through the proposed Rs 495-crore IPO of Neptune Enterprise, which had filed draft red herring prospectus (DRHP) with Securities and Exchange Board of India (SEBI) in December 2009. Indiareit had invested about Rs 208 crore in Neptune.
According to sources, apart from Neptune, Indiareit plans partial exits from projects such as Skyline (Bangalore), Samira (Mumbai) and SSPDL Northwood (Hyderabad) this year. It made a partial exit of Rs 49 crore from Aristo (Mumbai) last month, where it invested Rs 150 crore. It is learnt that this project has attained a market value of Rs 300 crore currently.
Indiareit handles three funds currently, Indiareit Domestic Fund Scheme I (Rs 430 crore), Indiareit Domestic Fund Scheme III (Rs 537 crore) and Indiareit offshore fund ($200 million). It is in the process of raising Rs 750 crore Indiareit Domestic Fund Scheme IV including green shoe option of Rs 250 crore. It has already raised Rs 150 crore and is expected to complete the fund-raising in a couple of months.
Ramesh Jogani, Managing Director & CEO, told VCCircle, "Nearly 70% of our investments are in residential projects which see a major comeback nowadays. Residential projects start giving returns from day 1 as opposed to other investments such as investments malls." He declined to divulge details on the exits.
There are about nine investments made from the Indiareit Domestic Fund I which includes Alpha City, Chennai (Rs 23.8 crore), Amsri Grande, Hyderabad (Rs 20.3 crore), Neptune Kurla (Rs 28.8 crore), Amsri Global (Rs 27.8 crore), Amsri Cygne (Rs 29.4 crore), Amsri Brainstorm (Rs 20 crore), Paranjape Blueridge, Pune (Rs 49.5 crore), Skyline I, Bangalore (Rs 63 crore), Samira I, Mumbai (Rs 17 crore). It has made an exit from Signature Island, Mumbai, where the investment was Rs 63 crore, while it partially exited from Bangalore Retreat where it had invested Rs 21 crore.
Indiareit Domestic Fund III invested in Skyline II (Rs 39 cr), Neptune Enterprises, Mumbai (Rs 57 cr), SSPDL Northwood, Chennai (Rs 45 crore) and Samira II (Rs 48 crore). Indiareit Offshore Fund invested in Amsri Grande (Rs 47 crore), Neptune Kurla (Rs 115 crore), Amsri Global (Rs 111 crore), Paranjape Blueridge (Rs 198 crore) and Neptune Enterprises (Rs 151 crore).
Indiareit also has plans to raise another offshore fund with a size of $250-300 million in the next financial year. "By 2011, activities in real estate sector will be in full swing, which causes flow of more offshore funds into the country," Jogani added.
According to VCCEdge data, about 86 PE deals took place in the real estate sector since 2000 with a total value of $3.8 billion. This year, the major investment was made by Temasek in Sobha Developers worth $20.5 million. Till date, about 11 deals took place worth $185 million in real estate sector this year.