Real estate investment firm Red Fort Capital has invested an undisclosed amount in two residential projects in the Delhi-National Capital Region. The Delhi-based private equity firm has backed Esencia Phase II, a 108-acre affordable housing development in Gurgaon, and Delhi Heights, a 38-acre residential and mixed-use project in the heart of Delhi. Both the investments have been made from the investment manager's second fund, a statement said.
Esencia Phase II is part of the fund's joint venture with Delhi-based Ansal Properties & Infrastructure Ltd, in which the firm had picked up a 26% stake for Rs 200 crore earlier this year. This JV will develop an additional 108-acre township project adjacent to Ansal’s existing 112-acre Esencia township project in Gurgaon.
The real estate fund manager said that their residential projects have already reached advanced execution stages. Sales and construction have commenced in Esencia Phase II, which includes over 5 million square feet of row homes and villas. Besides, a global execution team has been finalised for the design and construction of Delhi Heights, which will comprise of 2,000-plus premium residential units, 30-50 story towers and mixed-use amenities.
Subhash Bedi, Managing Director, Red Fort Capital, said that their investment strategy for Fund II is a continuation of the approach utilised for Fund I, where they emphasized residential development. Over 70% of the portfolio has been residential and "strategically located office and mixed-use projects".
This is the third deal in last five months from Red Fort. In its earlier deals, in October last year, the fund had picked 24.5% stake in an office complex project by another Delhi-based realty firm Parsvnath Developers Ltd in the capital city’s central business district Connaught Place for Rs 120 crore. Last November, Red Fort Capital had formed yet another venture with Parsvnath Developers for jointly bidding to develop 5 million sq.ft. residential and mixed-use project on a 38-acre parcel near Connaught Place from India’s Rail Land Development Authority for $360 million.
Indian realty sector has been on a recovery path after seeing the asset price bubble burst in 2008 with credit squeeze and high interest rates. Although the revival was led by rising demand for residential housing projects, commercial realty has seen an uptick for the last six months.