HDFC, L&T in talks for a development and investment platform

HDFC Capital is in talks with Larsen and Toubro Realty to set up a residential development and investment platform with an investment of Rs 4,000 crore. The joint platform will be structured as an Alternative Investment Fund (AIF) which will make investments in mid-market residential projects in the country. HDFC Capital Advisors and L and T Realty to infuse equity into the platform. The developer shall be responsible for executing projects having the investments of the joint entity. It is said that the discussions have reached an advanced stage and the final decision regarding the equity infusion by both of them will be taken soon. The investment platform will raise the fund from the market after deciding on the equity infusion by HDFC Capital and L and T Realty. HDFC Capital has a plan to invest approximately $2 billion in affordable housing, it has secured the first close for a fund among the world’s largest residential property investments. HDFC Capital Affordable Real Estate Fund 3 had already garnered $1.22 billion by mid-January and the total corpus will be around $2 billion, which includes potential reinvestments. The primary investor for the same was a wholly-owned unit of the Abu Dhabi Investment Authority (ADIA). H-CARE-3 is HDFC Capital’s third fund. The previous funds raised, Affordable Real Estate Funds 1 (2016) and 2 (2017) totaled $3 billion. It has formed alliances with Rustomjee Group, Prestige Group, Ambuja Neotia, Runwal Group, Shapoorji Pallonji Real Estate, and Arvind Smart Spaces. Image Source