Second Real Estate Fund on the Horizon for Anand Rathi and Knight Frank India
Anand Rathi Financial Services and Knight Frank India are preparing to unveil their second real estate fund by the close of this month, aiming to garner approximately Rs 500 crore (around $100 million). This information comes from sources familiar with the development. In contrast to their contemporaries, who are directing fundraising efforts overseas, this collaborative "rental yield and appreciation portfolio" (RYAP) fund will focus on securing capital within the domestic market. Mirroring its predecessor, it will invest in commercial properties situated within major Indian cities, encompassing locales such as Mumbai, Pune, Bangalore, the National Capital Region (NCR), and Chennai.
The fund aspires to achieve returns ranging between 10% and 12% on their investments. The firms plan to retain investments in each asset for a duration of four to five years. A high-ranking representative of the joint venture fund management firm, requesting anonymity, stated, “We are waiting for final Alternate Investment Fund (AIF) guidelines as right now there is no clarity on registration of funds and other norms. Once we have clarity on the same which we are expecting by mid-May we will register and start our fund raising process.”
Regulatory Clarity Awaited
On April 2nd, the Securities and Exchange Board of India (Sebi), the regulatory body for the securities market, introduced its conclusive set of regulations designed to oversee Alternate Investment Funds (AIFs) across India. Fund managers are predicting the release of comprehensive guidelines within the upcoming two weeks.
Previous Fund's Investments
Knight Frank India and Anand Rathi Financial Services established their partnership two years prior, leading to the creation of a Rs 225 crore rental yield fund. From this pre-existing fund, Rs 135 crore has already been allocated to two specific projects. These include a commercial endeavor by Hub town Ltd located in Mumbai and the Cerebrum IT park development helmed by Pune-based Kumar Urban Development Ltd.