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The Development Bank of Japan (DBJ) has partnered with HDFC Capital to invest in an India-focused real estate fund aimed at developing affordable and mid-income housing projects. The H-DREAM Fund has a targeted corpus of USD 1 billion, including a USD 500 million greenshoe option, and has already received investor commitments of more than USD 350 million. The investment marks DBJ’s first real estate investment in India and comes amid growing participation by Japanese institutions in India’s financial and property sectors. The fund will focus on green housing developments and will operate through GIFT City’s offshore feeder fund structure.
The Development Bank of Japan (DBJ) has joined hands with HDFC Capital to invest in a real estate fund focused on the development of affordable and mid-income housing projects across India. The fund has a targeted corpus of USD 1 billion, including a base size of USD 500 million and a greenshoe option of another USD 500 million. Advertisement
HDFC Capital said in a statement issued on Thursday that DBJ has made its first real estate investment in India through a commitment to the HDFC Capital Development of Real Estate Affordable and Mid-Income Fund (H-DREAM Fund). However, the financial details of DBJ’s investment were not disclosed.
The H-DREAM Fund is managed by HDFC Capital Advisors Ltd and has already secured investor commitments exceeding USD 350 million. Earlier last year, the International Finance Corporation (IFC) had committed up to USD 150 million as an anchor equity investment in the same fund.
HDFC Capital, the real estate private equity arm of the HDFC Group, is among the larger real estate-focused investment platforms in India with combined funds exceeding USD 4.5 billion. The company has largely focused on affordable and mid-income residential developments, while also backing green housing projects through the H-DREAM platform.
Deepak Parekh, Non-Executive Chairman of HDFC Capital, said the India-Japan relationship continues to strengthen through institutional cooperation and increasing Japanese participation in India’s financial and real estate sectors. He added that DBJ’s first real estate investment in India is significant and reflects long-term investor confidence in the country’s housing market.
DBJ said the investment would support the sustainable growth of India’s real estate sector, particularly at a time when the country continues to face a housing shortage in urban and semi-urban markets. Affordable and mid-income housing has remained a key area of policy focus over the past few years, supported by demand from end-users and government-led housing initiatives.
Vipul Roongta, CEO of HDFC Capital, said the partnership with DBJ would help strengthen funding support for quality affordable and mid-income housing projects. He added that HDFC Capital’s focus on early-stage financing has helped attract long-term global investors looking at diversification and sustainable development opportunities in India.
The investment has been routed through HDFC Capital’s offshore feeder fund structure set up under the International Financial Services Centres Authority (IFSCA) framework at Gujarat International Finance Tec-City (GIFT City). The structure has increasingly been used by global investors seeking exposure to India’s real estate and infrastructure sectors through regulated offshore investment platforms.
DBJ is a Japanese government-owned financial institution that provides investment and loan services for companies and development projects across sectors.
Source PTI
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