Close To $12-Bn Funds May Be Invested In FDI-Approved Projects
EVEN as investment by foreign portfolio funds in real estate remains a contentious issue, close to $10.5-12bn of foreign funds are awaiting opportunities to invest in FDI-approved real estate projects in India.
While investments into hotel and tourism is allowed under automatic FDI approvals, there are restrictions in other areas. For instance, in service housing plots, the restriction is minimum area of 10 hectares or 25 acres. In the case of construction development project, the minimum built-up area has to be 50,000 sq. metre. There are also other restrictions such as minimum investment of $10m, repatriation restriction, etc.
But all these restrictions are not preventing funds which have already set up operations in the country. Funds like Starwood Capital, CapitaLand, AIG Real Estate, West Point, Farrllon Capital, Lehman Brothers and Morgan Stanley Real Estate, GE Commercial, Citi Property, Merrill Lynch and JP Morgan have already established presence in India. Most of these funds have recruited fund managers and already started making investments.
Rajesh Agarwal from Cushman & Wakefield has joined AIG’s real estate fund. Balaji Rao, who was heading TCG Infrastructure, is now heading the Indian operations for Starwood Capital. The USbased Starwood Capital is one of the largest real estate investment firms based in the US, planning to invest $250 in the residential and hospitality sector in India.
The US-based Vornado Realty Trust has formed a JV with Chatterjee group’s TCG Infrastructure and plans to invest $300m here. CapitaLand Retail India — the Indian arm of the Singaore-based Real Estate Investment Trust (REIT) Capita-Land — has singed a memorandum of understanding (MoU) with Mumbaibased Runwal Group to invest Rs 100 crore in the latter’s proposed township project. CapitaLand Retail has also formed a JV with Pantaloon Retail and will invest $75m in Pantaloon’s international realty fund, Horizon Realty Fund.
Morgan Stanley Real Estate announced a proposed investment in Bangalore-based Mantri Developer. Startwood, AIG Real Estate, Lehman Brothers have started full-fledged operations in India with a focus on foreign direct investment (FDI) compliant projects. All these funds have set up Indian operations with Indian heads.
“For several years, we have been targeting India as an important investment market. We are here not just as mere investors. Like in the overseas market, we want to create a brand name in the Indian market. Recent regulatory changes combined with the soaring demand for both residential and commercial property space present a great opportunity for us. We want to focus mainly on FDI-compliant real estate projects. Currently, we are in talks with various developers,” Balaji Rao, head of Indian operations, Starwood Capital, said.
Source : ET
EVEN as investment by foreign portfolio funds in real estate remains a contentious issue, close to $10.5-12bn of foreign funds are awaiting opportunities to invest in FDI-approved real estate projects in India.
While investments into hotel and tourism is allowed under automatic FDI approvals, there are restrictions in other areas. For instance, in service housing plots, the restriction is minimum area of 10 hectares or 25 acres. In the case of construction development project, the minimum built-up area has to be 50,000 sq. metre. There are also other restrictions such as minimum investment of $10m, repatriation restriction, etc.
But all these restrictions are not preventing funds which have already set up operations in the country. Funds like Starwood Capital, CapitaLand, AIG Real Estate, West Point, Farrllon Capital, Lehman Brothers and Morgan Stanley Real Estate, GE Commercial, Citi Property, Merrill Lynch and JP Morgan have already established presence in India. Most of these funds have recruited fund managers and already started making investments.
Rajesh Agarwal from Cushman & Wakefield has joined AIG’s real estate fund. Balaji Rao, who was heading TCG Infrastructure, is now heading the Indian operations for Starwood Capital. The USbased Starwood Capital is one of the largest real estate investment firms based in the US, planning to invest $250 in the residential and hospitality sector in India.
The US-based Vornado Realty Trust has formed a JV with Chatterjee group’s TCG Infrastructure and plans to invest $300m here. CapitaLand Retail India — the Indian arm of the Singaore-based Real Estate Investment Trust (REIT) Capita-Land — has singed a memorandum of understanding (MoU) with Mumbaibased Runwal Group to invest Rs 100 crore in the latter’s proposed township project. CapitaLand Retail has also formed a JV with Pantaloon Retail and will invest $75m in Pantaloon’s international realty fund, Horizon Realty Fund.
Morgan Stanley Real Estate announced a proposed investment in Bangalore-based Mantri Developer. Startwood, AIG Real Estate, Lehman Brothers have started full-fledged operations in India with a focus on foreign direct investment (FDI) compliant projects. All these funds have set up Indian operations with Indian heads.
“For several years, we have been targeting India as an important investment market. We are here not just as mere investors. Like in the overseas market, we want to create a brand name in the Indian market. Recent regulatory changes combined with the soaring demand for both residential and commercial property space present a great opportunity for us. We want to focus mainly on FDI-compliant real estate projects. Currently, we are in talks with various developers,” Balaji Rao, head of Indian operations, Starwood Capital, said.
Source : ET