Motilal Oswal Real Estate (MORE) has announced the first close of its fifth real estate fund with `650 crore of commitments received. India Realty Excellence Fund V (IREF V) was launched with a target corpus of Rs 800 crore.
The latest realty fund will focus on providing senior secured debt in post-approval projects. The fund plans to deploy the capital in mid-income/ affordable residential projects across the top seven cities in India, while selectively investing in commercial projects. IREF V would undertake 12-15 transactions over its entire fund life. This fund has been raised from high net worth individuals (HNIs) and family offices. The fund is set up as an alternative investment fund (AIF Category II).
Till date, MORE through its real estate funds and PMS/NCD investments has funded 89 projects via 68 investments and successfully exited 33 investments. With IREF V, MORE’s cumulative assets under management is now over Rs 4,400 crore. MORE is a part of Motilal Oswal Private Equity (MOPE), the alternative investments platform of Motilal Oswal Financial Services.
Vishal Tulsyan, MD & CEO, MOPE said “We believe that the realty sector is currently at an inflection point. With this fund, our cumulative private equity AUM has crossed $1 billion and real estate forms a key part of that AUM”.
Sharad Mittal, director & CEO, MORE said, “There has been a huge gap in construction finance available in the sector over the last two years pursuant to the NBFC crisis and now the COVID pandemic. The real estate sector has gathered a lot of momentum during the last 6-7 months on the back of bottomed-out prices, peak affordability, historically low mortgage rates, government incentives and increasing emotional value of home-ownership during the pandemic. Several developers have clocked record sales in the last two quarters of FY21. However, liquidity is still a concern which is where this fund will help our developer partners.”
The IREF V fund has already made its first investment with Shriram Properties in Bangalore.