The US-based private equity fund major, Fire Capital, has set sight on the Indian real estate sector in a big way. The fund house had earmarked $500 million equity investment to be spent over a period of five years on various realty projects, particularly on integrated townships, across the country, vice-president (marketing & sales) Rohit Sehgal said.
Speaking to FE on Tuesday, he said: ?We will be investing $100 million a year on an average in the Indian real estate sector for the next five years, particularly on integrated townships across the country. We have already raised $250 million and will raise further as and when required.
?We are bullish on the prospects in India. Apart from real estate, the fund house will also look at infrastructure, logistics and affordable housing for potential investments,? Sehgal said.
?We make project-specific investments through special purpose vehicles (SPVs) and generally follow that the fund house will hold a majority stake in the SPV, at least 50% in each project. However, based on the nature of project and the cost involved, we may opt for lower stake too,? he said.
?The fund takes strategic equity positions in real estate projects and exits these investments on completion of sales, or at a premium after the project achieves stable cash flows,? Sehgal said.
According to him, the company is currently involved in various township projects in Jaipur, Bangalore, Nagpur and Chennai and is looking at more such ventures across India.
Meanwhile, Fire Capital has entered into an agreement with Arcor Group of Nagpur to promote an integrated township project with an estimated outlay of $200 million, to be spent over a period of time.
A special purpose vehicle, Fire Arcor Infrastructure Private Ltd, has been floated to develop more than six million sqft of built-up area.
The township, christened as The Empyrean, was the largest FDI-promoted project in central India, he said.
Hong Kong-based Aedas, the world?s fourth largest architectural firm, has conceptualised and master planned the project. The township will offer 5,000 residential units ranging from the most exquisite villas at the top end to elegant row houses and affordable apartments. It is expected to be completed in phases over the next six years, with the first phase I getting delivered in about 24-30 months from now.
