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Motilal Oswal Alternates (MO Alts), the investment arm of Motilal Oswal Financial Services, has achieved a significant milestone by raising more than INR 1,250 crore for its sixth real estate fund, India Realty Excellence Fund VI (IREF VI).
With a target corpus of INR 2,000 crore, including an additional provision of INR 500 crore for potential supplementary funds, the IREF VI fund is meant to make early-stage investments primarily in mid-income and affordable residential projects across India’s top eight cities: Mumbai, Delhi-NCR, Pune, Bangalore, Chennai, Hyderabad, Kolkata, and Ahmedabad.
The commitments for this category II alternative investment fund (AIF) have come from high net worth individuals, non-resident Indians, family offices, and corporates, showing investor confidence in MO Alts' capabilities and the promising outlook for the real estate market.
Vishal Tulsyan, MD & CEO of MO Alts, expressed optimism about the real estate market, highlighting the successful and rapid first close of the fund, which he described as the largest to date. Saurabh Rathi, Co-Head of Real Estate at MO Alts, echoed Tulsyan's sentiments, emphasising the resilience and growth of the Indian real estate market. Rathi pointed out the high demand in the residential sector and strong absorption in the office market, signaling the need for early-stage capital.
MO Alts' track record speaks for itself, with over 150 investments and funding exceeding INR 7,500 crore across 50 developers in India. The company has achieved over 85 investment exits with an internal rate of return (IRR) surpassing 20% from their pre-approved investments.
The sixth real estate fund has attracted interest from high-net-worth individuals, NRIs, and family offices/corporates, with significant interest from NRIs in the Gulf Cooperation Council (GCC) countries.
As project sizes and land prices increase, there’s a surge in demand for land acquisition, with around INR 70,000 crore worth of land being developed for residential projects annually. Vishal Tulsyan anticipates a significant rise in the number of families in the INR 10-30 lakh income bracket over the next 6-7 years, potentially leading to a requirement of over INR 25 lakh crore for land acquisition.
Anand Lakhotia, Co-Head of Real Estate at MO Alts, highlighted the company's strategic position to seize emerging opportunities, with a promising deal flow and a strong pipeline of investment opportunities in major cities with attractive risk-adjusted yields.
Motilal Oswal Financial Services' alternative investments platform manages over USD 2 billion in assets across growth stage private equity and real estate sectors. Despite global economic uncertainties, India's robust domestic consumption and solid macroeconomic fundamentals continue to drive growth and stability, with the momentum in real estate and infrastructure activities contributing significantly to India's economic growth trajectory.
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