ASK Property Investment Advisors (ASK PIA), the real estate private equity arm of the ASK group, on Tuesday announced the launch of a new real estate fund with a target corpus of Rs 2,500 crore including a green-shoe option, the company in a statement said.
Christened as ASK Real Estate Special Opportunities Fund – IV, the fund is targeting a corpus of Rs 1,000 crore ($130 million) and an additional Rs 1,500 crore via a green shoe option.
It will raise the funds from a mix of offshore and domestic investors.
The statement said that the fund is in line with ASK’s focus on the affordable & mid segment residential and mix land use projects.
The fund will focus on job growth corridors across the top 6 cities of India and identify projects of reputed developers for financing.
“This fund’s strategy is a mirror image of our fully deployed previous fund. We will provide early, mid, and last mile funding for fully approved projects by customer-centric developers with an established delivery track-record.
We intend to announce the initial close of the fund at Rs 750 crore by September. We currently have a strong pipeline of over Rs 500 crore of investments pre-identified for deployment. We have deployed over Rs 400 crore during the quarter ending March-2021,” Amit Bhagat, managing director and chief executive officer, ASK PIA, said.
“The real estate sector has been facing a paucity of capital since the NBFC crisis in 2018 which has been heightened, since last year, due to the ongoing pandemic. On the contrary, sales in the sector have been witnessing green-shoots of revival since H2-FY2021.
We foresee a steady uptick in demand on the back of historically low home loan rates coupled with stamp duty incentives in states like Maharashtra and discounts offered by several developers. Demand has been predominantly towards completed and nearing completion inventory.
Sales have been driven by first time home buyers and end users seeking to upgrade to larger homes to accommodate ‘working from home’. Our fund will leverage on the shortage of capital and rising demand to deliver superior risk adjusted returns,” Sunil Rohokale, managing director and chief executive officer, ASK Group, said.
ASK PIA has raised around Rs 5,000 crore since 2009 and investors include family offices, ultra high net worth individuals (UHNI), high net worth individual (HNI) and institutions.