IndiaReit marks part exits worth $80M with 2x returns

05 December, 2012

Piramal Enterprises’ real estate fund house IndiaReit Fund Advisors has announced exits worth Rs 440 crore ($80 million) from three of its earlier funds of 2006-07 vintage and one from a third-party mandate.

The fund house had previously recorded exits of Rs 905 crore to its investors, said Khushru Jijina, managing partner IndiaReit. IndiaReit had brought in Jijina to head the business after the exit of Ramesh Jogani.

The exits include a phased part stake sale of its SEZ project in Hinjewadi with Pune-based developer Paranjape Schemes, where it has raised close to Rs 241 crore by selling half its stake. Indiareit had invested Rs 242 crore for a 30 per cent shareholding in the project back in 2007. Sources indicate IDFC has undertaken the secondary deal and has bought 1.5 million sq. ft. in the SEZ.

The entire SEZ has a total development potential of 2.9 million sq. ft. of which 1.48 million sq. ft. (Phase I) is currently built and leased to tenants like Accenture, Cisco, L&T, Persistent, KPIT and Crisil. In the residential portion, more than 400 units have been handed over to the end users. The fund has stayed invested in the six million sq. ft. residential portion.

The second exit came from its investment in Mumbai with the Ariisto Group in a residential project at Santa Cruz as well as a mixed use project at Goregaon. Ariisto Sapphire, a 83-unit premium luxury development, has been completed and handed over. The retail portion of the Goregaon project has been constructed and is in the process of being leased out even as the residential portion is currently under construction.

Indiareit had invested Rs 150 crore across both these projects back in 2008 and has realized Rs 117 crore with further Rs 190 crore expected to come in within the next quarter.

Additionally, as advisors to its offshore fund, IndiaReit has been advising on the proposed exit in Forest Trails, a 3 million sq. ft. residential township located at Bhugaon in Pune, also being developed by Paranjape Schemes, for which a term sheet has been executed by the offshore fund.

The first phase of 160 villas has been completed and handed over and the second phase, comprising apartment units, has been launched to healthy pre-sales, as per the firm. The offshore fund had invested Rs 109 crore for a 50 per cent stake in the project in January 2011, with the exit amount translating into an IRR of 20 per cent over the two year tenure. The fund’s lifeline ends in 2014.

Besides these three, IndiaReit also advised on the exit from an investment held by Trafalgar/F&C REIT, one of the offshore managed accounts. The investment was in a plotted residential development project located off the L&T Bypass road in Coimbatore.

(Edited by Prem Udayabhanu)


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IndiaReit marks part exits worth $80M with 2x returns

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