The domestic alternative investment fund had invested Rs 85 crore in Bengaluru-based Shriram Pristine Estates from ASK Real Estate Special Opportunities Fund IV (RESOF IV) in 2022. The exit from the investment yielded an internal rate of return (IRR) of 20 per cent and an investment multiple of 1.24x on its quasi-equity investment in less than 18 months.
“This investment is a classic example of an opportunity arising from industry consolidation, as strong sales ensured a successful exit for us. This is part of our platform agreement with Shriram Properties, and we intend to actively participate in their expansion and growth in the near future,” said Lakshmipathi Chockalingam, Managing Partner, South, ASK Property Fund.
Shriram Pristine is a plot development project in Doddaballapur, a prominent suburb in North Bengaluru with a saleable area of 0.8 million sq ft. The plot development was acquired from IIFL in December 2022. It marked the company’s initial acquisition under the co-investment platform established with ASK Property Fund. Separately, it also acquired 100% development rights in a residential project in Chennai with a total saleable area of 1.9 million sq ft.
“The mid-segment real estate market has shown great resilience and rapid growth over the past few years, creating significant opportunities for leading brands. To support this robust growth, we intend to increase new project additions in key markets such as Bangalore, Chennai and Pune. We aim to more than double our new project pipeline in the coming quarters,” said Murali Malayappan, Chairman and Managing Director, Shriram Properties.
ASK Property Fund has invested in several residential projects with Shriram Properties under their platform agreement. In October 2023, ASK Property Fund, the alternative asset investment arm of the ASK Group, entered into an agreement with SPL to set up a Rs 500 crore investment platform dedicated to acquiring residential real estate projects. “Their accelerated sales and accelerated completion led to stronger cash flows and presented an opportunity for an early exit that accrued value for both partners and improved profitability for the company,” it said. The residential real estate market has shown a strong recovery with most major cities reporting record sales compared to previous years. This has led to a surge in investments in the sector, with funds dedicated to the residential segment making a strong comeback.
Institutional investments in India’s real estate sector hit a three-year high of $2.5 billion in the June quarter. The residential segment witnessed strong growth, registering a 7.5-fold increase in investment over the previous year at $543.5 million, garnering a 21% share, Colliers said.
ASK Property Fund specialises in private equity investments in affordable and mid-income residential and commercial segments with auto-liquidation. Since 2009, it has raised Rs 6,100 crore from investors including family offices, ultra-high net worth individuals and institutions.
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