Motilal Oswal Real Estate closes second real estate fund at Rs500 crore

Motilal Oswal Real Estate (MORE), the real estate arm of Motilal Oswal Private Equity has closes its second real estate fund - India Realty Excellence Fund II (IREF II) - by raising Rs500 crore.

The company is also planning to launch third fund with a corpus of Rs 750 crore.

The second fund had a target of Rs300 crore with a Green Shoe option of Rs 200 crore taking the total size to Rs500 crore. MORE had announced the first close of its latest investment vehicle at Rs225 crore last year.

IREF II is managed and advised by the private equity firm. The first fund, India Realty Excellence Fund (IREF), is currently under exit mode and has already returned about 80 per cent capital back to its investors.

''Real Estate fund platform continues to remain a critical focus area under the Motilal Oswal Private Equity Business. We are present across the capital stack and look forward to scale this platform further,'' says Vishal Tulsyan, MD & CEO, Motilal Oswal Private Equity Investment Advisors.

The fund has closed four new transactions with developers in Bangalore, Mumbai, NCR and Chennai.

Together with the earlier investments with Ahuja Developers in Mumbai and Mahaveer Group in Bangalore, the fund has now deployed more than Rs385 crore and is looking to deploy the balance capital over next three months.

IREF II has invested with Shriram Properties for their mid-income residential project located off Old Madras Road in Bangalore.

The project, with a total saleable of about 2 million sqft was launched in October 2014. In its second transaction, it disbursed money to Rajesh Lifespaces for a residential project located at Vikhroli, Mumbai.

The third investment is with ATS Infrastructure in Noida. The fund has invested in the second phase of the residential project – 'Pristine' located in Sector 150. In another investment in Chennai, the fund has backed Casa Grande's acquisition of 5.5 acres of land in Alandur, located in close proximity to Guindy - an established commercial hub. The project shall consist of total saleable area of ~ 0.37 mnsft.

Sharad Mittal, director and head, Real Estate Fund, said, ''We are pleased with the confidence shown by the investors in our fund management capabilities."