Kotak gets 50% commitment from ADIA for $1 bn real estate fund
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Kotak gets 50% commitment from ADIA for $1 bn real estate fund

By Beena Parmar

  • 15 Nov 2022
Kotak gets 50% commitment from ADIA for $1 bn real estate fund
Credit: VCCircle

Kotak Mahindra Group’s alternative asset arm Kotak Investment Advisors Ltd (KIAL) has secured an anchor investment of $500 million from a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA) for its 13th real estate fund with a total size of $1 billion. 

Domiciled in Gujarat’s GIFT City, Kotak’s 13th real estate fund will primarily invest in residential opportunities in India, the company announced on Tuesday. 

“The real estate platform is aimed at targeting opportunistic real estate investments in India.  With this new fund, KIAL has raised, managed or advised more than $3.3 billion under its real estate fund series,” KIAL, the alternative investment arm of Kotak Mahindra Group, said in a statement. 

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“This is an opportunistic fund which can invest across various real estate asset classes and capital stack i.e. both debt and equity. With the first close of this fund, KIAL has raised around $1.5 billion in real estate across multiple strategies in around one and a half years,” said Vikas Chimakurthy, chief executive officer, Kotak Realty Fund. 

In June this year, Kotak had also announced ADIA’s commitment in the 12th real estate fund, for investments in office assets in India, with a total corpus of $590 million (around Rs 4,600 crore). 

ADIA, sovereign wealth fund of the gulf emirate, is also a limited partner (LP) investor in Kotak Special Situations Fund, which is in process of raising its second new fund

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“This (13th fund) agreement extends our existing and longstanding relationship with Kotak. The new platform is primarily targeted at the significant demand for housing in India, which is driven by sustained economic growth and a shortage of urban housing clusters,” said Mohamed AlQubaisi, Executive Director of the Real Estate Department at ADIA. 

Among the most active home-grown investors, KIAL is on a fundraising spree launching multiple funds across segments. This year, VCCircle reported that the Kotak investment arm, is also in process of raising multiple funds, is also set to foray into venture capital, venture debt and buyouts space. 

Set up in early 2005, KIAL has so far raised/managed/advised in aggregate over $6.8 billion across different asset classes including real estate funds, private equity funds, infrastructure funds, special situations fund, listed strategies and investment advisory, all led by independent investment teams. 

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“As an India focused alternate asset manager, Kotak has played a key role in attracting global capital to various alternate asset investment strategies in India.  Kotak’s Real Estate Investment practice has been a consistent performer over 17 years across cycles and strategies. This track record has enabled us to emerge as a leading home-grown alternate asset manager with a significant Global LP base who have reposed faith multiple times with Kotak with significant Re-up participation in successor funds,” added Srini Sriniwasan, managing director, KIAL. 

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