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A subsidiary of the Kalpataru Group, Alder Residency, has secured debt facilities totalling Rs 525 crore from PAG, a global alternative investment firm, for a 3.5-year term. The funds, provided by Asia Pragati Strategic Investment Fund, managed by PAG, were raised in two tranches as non-convertible debentures (NCD) at an internal rate of return (IRR) of 18.75%. This capital infusion aims to support the completion of the construction of 10 residential towers in Mumbai suburbs under the Kalpataru Vivant project, with an estimated project cost ranging between Rs 750-800 crore.
The debt facilities from PAG Asia to Alder Residency, a wholly owned subsidiary of Abhiruchi Orchards, a Kalpataru-owned entity, mark a significant financial move. In November, Asia Pragati Strategic Investment Fund invested Rs 475 crore in secured unlisted bonds and an additional Rs 49 crore in secured listed bonds, both maturing on April 30, 2027. The proceeds from these bonds are earmarked for repaying high-cost debt and contributing to the development of the Kalpataru Vivant residential project.
Alder Residency's board passed a resolution in October to raise Rs 620 crore through NCDs, emphasizing its commitment to secure the necessary financial resources for the ongoing project. The promoter, Parag Munot, has personally guaranteed the funds, and Abhiruchi Orchards has provided a corporate guarantee to PAG. Additionally, the fund holds a first-rank exclusive charge on the registered mortgage and development rights of the property, ensuring a robust financial structure for the transaction.
According to India Ratings, as of June 2023, Alder Residency had incurred approximately 24% of the overall development cost, encompassing 10% of the overall construction cost for the Kalpataru Vivant project. Management has communicated that all necessary approvals for eight towers have been secured, and as of the end of September 2023, the third floor for the remaining two towers has also received regulatory clearance.
The debt facilities from PAG reflect the financial confidence in the Kalpataru Group's real estate endeavors and are expected to contribute to the timely completion of the Kalpataru Vivant project. The strategic partnership aims to bolster the real estate sector in Mumbai suburbs and aligns with the broader objective of meeting the growing demand for quality residential spaces in the region.
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