Tishman Speyer plans $1 billion real estate fund

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Mumbai, Sep 9: Property developer and fund manager Tishman Speyer plans to raise up to $1 billion in a private fund in 8-10 months for Indian realty projects, the managing director for its India unit said on Tuesday.

“We still have some money left over from a previous one and we are already talking to investors for our next fund, though we haven’t started roadshows yet,” Revathy Ashok told reporters on the sidelines of a capital markets conference.

“Tishman has raised $350 million in a private fund this year and is funding three projects in south India,” she said.

High borrowing costs and a stock market slump have forced real estate firms to look at private equity for funding projects.

Private equity investing in India and China held steady in the first half of the year, the Asia Venture Capital Journal said, with India seeing a 3.2% rise to $6.8 billion, and China registering a 3% gain to $5.8 billion.

Real estate prices in India have cooled this year after a three-year boom as a series of interest rate hikes by the central bank to tame soaring inflation hit consumer demand for new homes and office spaces.

There is still some pain left for the real estate market in India, Ashok said.

New York-based private equity firm Jina Ventures plans to raise up to $200 million by end-2008 to invest mainly in manufacturing firms in India, its managing partner said.

We are talking to investors from Switzerland, the US and Japan and should be able to wrap up the fund by end-2008, Ron Shah told Reuters at the capital markets conference.

Jina Ventures had raised $50 million in 2005, which it invested in 12 Indian firms and had exited these investments, Shah said.

He said the opportunities in India remained abundant, but the current market volatility would mean foreign investors may take time to turn up in a big way.

India’s main stock index, The Bombay Stock Exchange (BSE) has fallen about 27% this year after a five-year bull run, hit by uncertainty in world markets and domestic factors such as double-digit inflation and moderating economic growth.