Piramal Fund Management invests Rs 700 crore in two commercial projects in Mumbai

Piramal Fund Management (PFM) has deployed Rs 700 crore collectively against two commercial properties – Reliable Tech Park and Empire Towers – in suburban Mumbai. As per reports, PFM will release the fund in tranches as the projects near completion. The proposed investment is in the form of flexible lease rental discounting (LRD) against 0.8 million sq ft that is fully leased, with the proceeds going towards completion of the remaining area, as per PFM. Reliable Tech Park and Empire Towers, together spread over 2.2 million sq ft at Airoli, are part of a complex called Cloud City Campus that extends to 2.7 million sq ft of leasable area. About a month ago, Piramal Fund Management expanded its portfolio to offer LRD loans for completed commercial assets, which encompass both office and retail space. Khusru Jijina, Managing Director, Piramal Fund Management, has reportedly said that he has given a construction funding for a Grade A project to a Grade A developer for five years, and he converts that (into LRD funding) once it is ready and leased for another 12 years or nine years to 12 years. He reportedly added that this way, the developer will be with him for 15 years to 17 years; and that is the stickiness of the loan. PFM initially identified a pipeline of transactions worth Rs 1,500 crore, and the latest deployment is part of this. It seems to be scaling it up to a book size of Rs 10,000 crore in 2017-18.