Edelweiss Alternatives plans to raise Rs 5,000 crore for its rental yield plus fund, targeting high-quality commercial properties in major Indian metros. Subahoo Chordia leads the fund, focusing on southern markets and aiming to build a 10-million-square-foot portfolio in three years. It will invest Rs 400 crore to Rs 2,000 crore per transaction, emphasizing core office assets and value-added older buildings. The second phase explores data centres and warehousing. Chordia highlights a decade of experience, stressing the appeal of the Indian market for private debt and real assets, expecting it to reach $5 trillion by 2027 with evolving regulations benefiting alternative asset managers.
Edelweiss Alternatives, the alternative asset arm of the Edelweiss Group, has unveiled an ambitious plan to amass a substantial capital infusion of up to Rs 5,000 crore from a diverse pool of both domestic and international investors for its nascent rental yield plus fund. A senior executive within the company revealed this strategic initiative.
At its core, this financial initiative revolves around the establishment of a novel rental yield plus fund, an intricate financial instrument luring investor with prospects of income and appreciation. The fund aims to carefully invest in premium commercial office properties across six key metropolitan centres, focusing on vibrant markets like Bengaluru, Hyderabad, Delhi-NCR, and Mumbai. The vision is to curate an extensive portfolio spanning a formidable 10 million square feet within a prudent three-year timeline.
Subahoo Chordia, President and Head of Real Assets at Edelweiss Alternatives, clarified the fund's approach, explaining that their investment spectrum is anticipated to range from Rs 400 crore to Rs 2,000 crore per transaction.
The focus is on fundamental office assets and aged structures that offer opportunities for value augmentation, aligning with discernible demand in the market for revitalized office spaces. The subsequent phase of this strategic endeavour is poised to encompass diversification into emerging asset classes, such as data centres and warehousing, in tandem with its persistent focus on fortifying its office property portfolio.
The targeted range for these office properties spans from 500,000 square feet to a substantial 1.5 million square feet. With over a decade of experience in navigating the intricacies of Indian private debt and real assets, Chordia emphasizes the organization's prowess in sourcing and structuring unique deals.
Their on-the-ground presence, coupled with robust asset management and operational capabilities, positions them as vigilant custodians actively monitoring and strategically engaging with investee companies. Chordia underscores the promise of risk-adjusted returns for private debt and real asset investors in the Indian market, aligning this optimism with the projected trajectory of the economy, set to reach $5 trillion by 2027.
In parallel, optimistic growth prospects and resilient demand drive institutional investors to express unwavering confidence in the Indian office sector. This has spurred significant activity, with global giants like GIC, CapitaLand India Trust, Bain Capital, CPPIB, and PAG Credit and Markets leading substantial deals in recent years.
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