The fund raising exercise for its India Realty Excellence Fund IV (IREF IV) started in September 2018, and now the final closure has been achieved with a commitment of Rs 1,150 crore.
“We have raised Rs 1,150 crore for our fourth fund during a very challenging period,” MORE Director and CEO Sharad Mittal told PTI.
The company has already made an investment commitment of around Rs 550 crore in nine projects from this fourth fund, he added.
“Our average investment size is around Rs 75 crore. Around 80 per cent of our portfolio is residential projects and 20 per cent commercial,” Mittal said adding the company targets upwards of 20 per cent return on its investment.
He said the company would be cautious in making further investments from its fourth fund and would wait and watch for at least next 4-5 months to understand the impact of global economic slowdown caused by the coronavirus outbreak.
“We will focus on managing assets under our portfolio,” Mittal said.
The money has been raised primarily from high net worth individuals (HNIs) and family offices.
“Existing investors from our previous funds have provided commitments to this fund notwithstanding the NBFC crisis during which we have raised this IREF IV fund,” Mittal said.
MORE had earlier raised around Rs 1,700 crore for three real estate funds.
MORE is part of Motilal Oswal Private Equity (MOPE), which is the alternative investments platform of Motilal Oswal Group. At present, the cumulative AUM (asset under management) under MORE stands at more than Rs 3,600 crore.
Vishal Tulsyan, MD & CEO, MOPE said, “In our private equity business, we manage an AUM of more than Rs 7,000 crore, of which 50 per cent is growth capital and 50% is real estate. Over the last few years, we have raised 4 funds and have established a successful track record as a domestic fund manager.” “Investing in real estate is one of the group’s core strategies and while we continue to focus on residential real estate, we will also evaluate investing in other asset classes as the sector transforms in the coming years,” he said.
Mittal said the company has made investment in projects of Casagrand Group (Chennai), Shriram Properties (Bangalore), Phoenix Group (Hyderabad), Kolte Patil Developers (Pune), ATS Group (Delhi NCR), SD Corp (Mumbai).
“The impact of the recent COVID-19 pandemic has been unprecedented wherein trade and businesses worldwide have come to a halt. It has impacted all sectors, including real estate. In India, since the announcement of the nation-wide lockdown, construction and sales activity across the entire real estate sector has been on a pause,” Mittal said.
He said the company is regularly reviewing the situation with developer partners to ensure proper cash flow management.
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