HDFC India Real Estate Fund

HDFC India Real Estate Fund marked the entry of the HDFC Ltd. into the business of real estate funds in India. Real estate fund refers to a fund that invests mainly in real estate so as to generate income and profits for the unit holders. HDFC Ltd. has entered into an agreement with the State bank of India for its launch into the business of real estate funds.

The real estate fund of HDFC India has been approved by the SEBI. The HDFC India Real Estate fund will invest in equities that are linked to companies who are mainly engaged in the business of real estate in the major cities of India. The fund had been opened for domestic institutions as well as for investors who are high-net worth individuals. The HDFC India Real Estate Fund has a ` 5 crore minimum contribution per investor.

The fund has been under HDFC Venture Capital Limited and in this company, the State bank of India has a stake of 19.5%. The target of HDFC India Real Estate Fund was ` 750 crore and it also had the green-shoe option of ` 250 crore. The fund by HDFC India for real estate is essentially a close-ended fund for a period of 7 years.

The following are the salient features of HDFC India Real Estate Fund:

• It will invest in the projects that are completed and real estate assets that have tenants of high net worth.
• It will invest in the projects that are in the developmental stage, which means that they have 1-3 years to go before commercial deployment.
• It will invest in the projects that are in the planning stage, which means that they have 3-6 years to go before commercial deployment

HDFC India Real Estate Fund has helped to boost the Indian real estate sector and led the way as far as private enterprise participation in Indian real estate is concerned.

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