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Fri 24 Jan 2020 01:16 AM

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Bahrain's Investcorp raises $130m for Indian affordable housing initiative

Initiative will focus on projects in the affordable and mid-market housing segment in the top seven cities in India

Bahrain's Investcorp raises $130m for Indian affordable housing initiative

Bahrain-based alternative asset management firm Investcorp has announced it has raised $130 million in anchor commitments which will primarily provide last mile funding in India, a market currently going through a liquidity crunch.

BAe Systems Pension Funds Investment Management Limited is the cornerstone investor for this initiative, which will focus on projects in the affordable and mid-market housing segment in the top seven cities in India and is subject to regulatory approvals and registrations, it said in a statement.

In India, Investcorp's real estate business has so far deployed over $200 million through two funds across 27 residential projects located in the top tier cities.

The funds provided structured senior credit to mid-market and affordable housing projects being developed by well-established developers.

Investcorp is also active in the mid-market private equity space in India, having made five investments, in Zolo Stays, Citykart, Intergrow Brands, Bewakoof, and Nephroplus in 2019.

Vikram Aggarwal, head of Private Markets, BAe Systems Pensions said: “We believe that the Indian affordable housing segment represents a sizeable and attractive market opportunity catalysed by urbanisation and structural reforms.

"BAe Systems is pleased to make a positive contribution to the development of affordable housing in India, where there is significant demand, but a lack of institutional quality capital to fund projects."

Ritesh Vohra, partner and head - Real Estate, Investcorp India, added: “The current slowdown in the residential markets as well as in the flow of credit in India create an opportune timing for us to launch this new lending initiative, which builds upon our track record of similar credit investments in India. Affordable housing has emerged as a dominant segment, augmented by government efforts and the introduction of favourable policy reforms.”

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