Godrej Properties teams up with APG for $275-mn real estate fund

Godrej Properties Ltd, the real estate development arm of the Godrej Group, has set up a dedicated fund management business, Godrej Fund Management, with a corpus of Rs1,900 crore ($275 million). Dutch pension fund asset manager APG Asset Management NV is the lead investor in the fund.

The fund, being set up as a subsidiary of Godrej Properties Ltd, will have offices in India and Singapore.

The fund will invest in residential projects in India, GPL, the real estate arm of the Godrej group, in a statement, said.

GPL said it has "created a dedicated real estate funds management business in India and Singapore - Godrej Fund Management (GFM)".

"GFM has raised a $275 million (Rs19 billion) pool of capital, Godrej Residential Investment Program II (GRIP II), with Dutch pension fund asset manager APG Asset Management NV (APG) as the lead investor," it added.

The new fund will advise GRIP II investors on investments into a residential development platform with GPL in India.

GRIP II is a follow-up to the $200 million residential development platform GPL had set up with an APG-led investor consortium in 2012.

GPL will hold a 20-per cent stake in GRIP II.

Karan Bolaria has been appointed as head of GFM and will be responsible for managing both series of the residential investment programmes as well as any future strategies that GFM will undertake.

"The new GRIP II platform in partnership with APG will help us attract high quality long-term equity investors to partner with us in our developments across India.'' GPL MD and CEO Pirojsha Godrej said.

"This fits well with our strategy of deepening our presence across the country's leading real estate markets while maintaining a capital-light development strategy," he added.

"In spite of a general slowdown in the asset class in the country over the last 3 years, our partnership projects have sold well, which is a testament to our partner's execution capability and brand strength,'' Sachin Doshi, MD and head of private real estate investments, Asia Pacific, APG, said.

APG and Godrej Properties' investment platform were among the first to start a joint venture approach in the Indian private real estate market in 2012. The structure was later followed by other foreign institutional investors and Indian developers.