Motilal Oswal Real Estate to raise up to Rs 1000 crore through 3rd fund

Q: The real estate arm of Motilal Oswal Group plans to expand the fund in residential projects of established developers in MMR, NCR, Bengaluru, Pune, Chennai and Hyderabad.

Gurmeet,

21st October 2015

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Replies (4)

Yes, and company has cleared their view that they continue to undertake mezzanine investments with established developers for their mid-income housing projects across top cities. They will also undertake structured equity investments depending on the market scenario.

Govinda,

23rd October 2015

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Now, the company is planning to double its total assets with its 3rd fund under management to about Rs. 2000 crore and they are committed to grow this business further. One thing which i notice that real estate investing has become company's one of the key business under the private equity business.

Nishant Bhat, Mumbai

22nd October 2015

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Yes, i heard that they will undertake about a dozen transactions of Rs. 80-120 crore each. The fund has been set up as an alternative investment fund or AIF category II registered with stock market regulator Sebi. The company expects to achieve 1st close by mid-January 2016 and conclude fundraising in the next 6 to 9 months depending on the market conditions.

Abhijit Thanki, Mumbai

21st October 2015

Comment

The reason is, real estate sector is going through consolidation phase and prices are expected to remain slow for some time. This is the correct time for investors to invest through indirect investing. That is why they are participating in the project profits rather than banking completely on the future price rise.

Puneet Laskar,

21st October 2015

Right Puneet,
And company's strategy is an extension of its experience with its 2 earlier funds in which it invested capital, typically under mezzanine structure, in top 5-property markets with developers such as ATS, Shriram Properties, Godrej Properties, Rajesh Lifespaces, Ahuja and Casa Grande. The new fund will also focus on top 6-property markets in the country.

Abhijit Thanki, Mumbai

21st October 2015

As per the company sources, the 1st fund worth Rs 200 crore, which was raised in 2009, has been fully invested and is currently in exit mode. The fund has exited its 4 out of total 7 investments and has returned about 82% of the capital.

And in March, co. had raised Rs 500 crore through its 2nd real estate fund. This fund is currently in investment mode and has invested around 80% of the capital. The balance capital will be invested in next 2 to 3 months.

Puneet Laskar,

21st October 2015

Yes, they are planning to raise fund through its 3rd real estate fund, mainly from high net worth individuals and family offices. And they expand the fund in residential projects of established developers in MMR, Bengaluru, Pune, Chennai and Hyderabad.

Indrajit Kaul, Bangalore

21st October 2015

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