Mumbai-listed developer Prestige Estates Projects Ltd has tied up with HDFC Capital Advisors Ltd, the real estate asset management arm of mortgage lender HDFC Ltd, to create an investment platform for low-cost housing projects in the country.
The platform will have a capital base of Rs 2,500 crore ($390 million) in equity and debt, the companies said in a statement. It will expand Prestige’s residential business by identifying land parcels where large-scale projects in the mid-income segment can be developed.
Venkat K. Narayana, CEO at Prestige Group, said the new capital pool will enable the company to strengthen its presence in different regions and tap into new growth markets.
Bangalore-based Prestige has lately realigned its businesses to bring investors on board for different verticals. It has bought back stakes of a couple of investors across residential and commercial projects. VCCircle had recently reported that the company is also working on bringing an investor on board for its commercial realty division.
Affordable housing has gained a lot traction in India in recent years thanks to the push by the central government and the shortage of low-cost homes.
Last year, HDFC Capital had formed a similar platform with Mahindra Lifespaces for affordable housing. However, it committed only around Rs 500 crore for this platform.
HDFC Capital manages two affordable housing funds--HDFC Capital Affordable Real Estate Fund I and II--which collectively have a corpus of around $1 billion. The company recently said it will use the two funds to create a $1 billion platform to target affordable and mid-income residential projects in India’s top 15 cities.
Another active investor in the affordable housing segment is International Finance Corporation, the private-sector investment arm of the World Bank. IFC recently committed capital for projects of north India-based developer Ashiana Housing.