HDFC Capital Advisors, a real estate private equity investment manager owned by major mortgage lender HDFC, has invested over Rs 1,550 crore in a portfolio of residential projects for developer Shapoorji Pallonji Real Estate.
The investment, made through structured debt instruments, will flow into six projects spread over approximately 7 million square feet in Mumbai and Pune. The companies said that it will be used for the financial closure of projects, the repayment of high-cost debt and working capital.
Our partnership with HDFC Capital Advisors will give us significant reach to take advantage of growth opportunities in our target markets. “This partnership will add tremendous value to our project portfolio and drive our growth even further,” said Venkatesh Gopalakrishnan, CEO of Shapoorji Pallonji Real Estate.
Vipul Rongta, President and CEO of HDFC Capital Advisors, said that through its partnership with Shapoorji, HDFC Capital will focus on meeting the growing demand for quality housing for middle-income families in India.
He said: "In line with the Government of India's 'Housing for All' vision, HDFC Capital seeks to increase the supply of housing in India by providing flexible long-term capital to leading developers in India.
The 6 projects I have invested in are new projects in the mid-income category with some premium components and affordable segments.
Among these projects, one of the projects involves the redevelopment of a large housing community in the central part of Mumbai.
Other projects include three planned development projects in the outskirts of Pune and a villa project that is part of the company's broader planning in the Hadapsar district of Pune.
While all approvals for the Central Mumbai project have now been obtained, permits for other projects are expected soon.
Prior to this partnership, in August, HDFC Capital Advisors signed an agreement with Ahmedabad-based Lalbhai Group Arvind SmartSpaces to create a Rs 900 crore platform to carry out residential developments.
The ongoing consolidation in the Indian real estate sector is gathering further momentum as certified developers continue to gain more market share in terms of sales and liquidity, as homebuyers increasingly prefer developers with a history of foreclosure. and a solid financial position.
Institutional investors also support such projects and developers due to the potential for a significant boost to bookings and sales, ensuring the potential for higher returns.
Shapoorji Pallonji Real Estate forms an important part of the Shapoorji Pallonji Group, a multi-company conglomerate. With a development potential of over 113 million square feet, the developer is working on projects in Mumbai, Pune, Bengaluru, Gurgaon and Kolkata.
The company has projects in all sectors, including luxury apartments, ambitious homes for middle-income homebuyers, and group housing projects.
HDFC Capital, founded in 2016, is the investment manager of HDFC Capital Affordable Real Estate Funds 1, 2 and 3, which comply with the government's "Housing for All" initiative.
It operates a $3 billion financing platform that has been ranked as one of the world's largest private financing platforms focused on affordable housing development.
Funds managed by HDFC Capital provide flexible, long-term financing throughout the lifecycle of affordable and middle-income housing projects, including early-stage financing.
HDFC Capital's goal is to finance the development of one million affordable homes in India through a combination of innovative financing, partnerships and technology, with a focus on sustainability.
HDFC Property Ventures and HDFC Venture Capital, wholly owned by HDFC, recently approved a plan to merge with HDFC Capital Advisors. The combined platform will advise and manage some $4.1 billion in assets, making it the largest private equity firm in India.
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