Investors warm up to realty, once again
The Economic Times, May 29, 2009, Page 17
FIs, MFs, HNIs Seen Flocking To Real Estate Funds
Shailesh Menon MUMBAI
AFTER a near 16-month hiatus, strategic investors are once again warming up to the real estate sector. A few foreign funds and local asset management companies have hit the road for raising money to be invested in real estate companies. Interestingly, even high net worth investors are flocking to these funds, say industry watchers.
Mutual funds raising funds towards realty investments include ASK Investment Holdings, Milestone Capital Advisors, Birla Sun Life Asset Management Company and the Singapore-based Morgan Stanley Investments. While ASK Investment Holdings has launched a Rs 500-crore PMS fund (that will invest into live realty projects through an investment vehicle) Milestone Capital and Birla Sunlife AMC are planning to raise Rs 600 crore and Rs 2,500 crore, respectively, for focused real estate investments. Almost all these funds are promising annualised returns in the range of 20-25%.
Both Morgan Stanley and Birla Sunlife are floating offshore real estate funds. According to market sources, Birla Sunlife will raise the money from West Asian and Latin American investors. Officials at Birla Sunlife refused to comment on the development. “Affluent investors who could not make much of the recent equity market rally are now trying to invest in real estate instruments. Even big-ticket funds are now raising money from investors. An HNI portfolio now will typically have 5% investments in real estate funds; overall real estate exposure would be in the range of 15-20%,” said Right Horizons Wealth Management CEO Anil Rego.
ASK Investment Holdings has launched a realtyfocused portfolio management scheme, with minimum investment pegged at Rs 25 lakh. The fund will make equity investments into live city-centric residential projects in seven cities. “The fund (with a fiveyear gestation period) has already received commitment for Rs 100 crore. We’re looking to invest the pool in cash-strapped projects; being an equity investment, we’ll have 26-49% equity participation in the invested projects,” said ASK Investment Holdings executive director Sunil Rohokale.
“We’ll invest only into properties which are completed and rented out, therefore eliminating development risk. The idea is to generate 20% annualised return over a period of four years,” said Milestone Capital CIO Ashish Joshi.
Sensex up 186 points
Shares extended their winning streak on Thursday with key indices finishing at eight-and-ahalf month highs, reports Our Bureau from Mumbai. Provisional data showed foreign funds to be aggressive buyers, net buying shares worth over Rs 1,800 crore. In a volatile session, the Sensex closed at 14296.01, up 186.37 points, over the previous close. The Nifty gained 61.05 points to close 4337.10. Metal, banking and capital goods shares were the star performers of the day while IT and pharmaceutical shares were under pressure.
The Economic Times, May 29, 2009, Page 17
FIs, MFs, HNIs Seen Flocking To Real Estate Funds
Shailesh Menon MUMBAI
AFTER a near 16-month hiatus, strategic investors are once again warming up to the real estate sector. A few foreign funds and local asset management companies have hit the road for raising money to be invested in real estate companies. Interestingly, even high net worth investors are flocking to these funds, say industry watchers.
Mutual funds raising funds towards realty investments include ASK Investment Holdings, Milestone Capital Advisors, Birla Sun Life Asset Management Company and the Singapore-based Morgan Stanley Investments. While ASK Investment Holdings has launched a Rs 500-crore PMS fund (that will invest into live realty projects through an investment vehicle) Milestone Capital and Birla Sunlife AMC are planning to raise Rs 600 crore and Rs 2,500 crore, respectively, for focused real estate investments. Almost all these funds are promising annualised returns in the range of 20-25%.
Both Morgan Stanley and Birla Sunlife are floating offshore real estate funds. According to market sources, Birla Sunlife will raise the money from West Asian and Latin American investors. Officials at Birla Sunlife refused to comment on the development. “Affluent investors who could not make much of the recent equity market rally are now trying to invest in real estate instruments. Even big-ticket funds are now raising money from investors. An HNI portfolio now will typically have 5% investments in real estate funds; overall real estate exposure would be in the range of 15-20%,” said Right Horizons Wealth Management CEO Anil Rego.
ASK Investment Holdings has launched a realtyfocused portfolio management scheme, with minimum investment pegged at Rs 25 lakh. The fund will make equity investments into live city-centric residential projects in seven cities. “The fund (with a fiveyear gestation period) has already received commitment for Rs 100 crore. We’re looking to invest the pool in cash-strapped projects; being an equity investment, we’ll have 26-49% equity participation in the invested projects,” said ASK Investment Holdings executive director Sunil Rohokale.
“We’ll invest only into properties which are completed and rented out, therefore eliminating development risk. The idea is to generate 20% annualised return over a period of four years,” said Milestone Capital CIO Ashish Joshi.
Sensex up 186 points
Shares extended their winning streak on Thursday with key indices finishing at eight-and-ahalf month highs, reports Our Bureau from Mumbai. Provisional data showed foreign funds to be aggressive buyers, net buying shares worth over Rs 1,800 crore. In a volatile session, the Sensex closed at 14296.01, up 186.37 points, over the previous close. The Nifty gained 61.05 points to close 4337.10. Metal, banking and capital goods shares were the star performers of the day while IT and pharmaceutical shares were under pressure.
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