The HDFC Capital Advisors planned to make an investment of Rs. 500 crore in Runwal Group’s Dombivali Mumbai-based township that is spread across 115-acre the sources said. The HDFC Capital is the subsidiary firm of India’s largest mortgage lender.
The HDFC Capital Advisors planning this investment via its affordable and mid-income housing investment platform HDFC Capital Affordable Real Estate (H-CARE). The firm lists Abu Dhabi Investment Authority, the sovereign wealth fund of the Gulf emirate, and India’s sovereign fund, the National Investment & Infrastructure Fund, as principal investors.
As per the sources, the investment is being made with a combination of equity and structured funding.
Runwal Residency, the sister firm of Runwal Group bought this land from Gammon India and is developing a mixed-use project on the same. A development of 13 million sq. ft. is estimated and the same will be completed in a phased manner of eight to ten.
At present, the company is going through the process of receiving approvals for the same.
Subodh Runwal, director at Runwal group said that the company has a successful alliance with HDFC PMS in the project earlier and also offered them with huge equity returns in the project Runwal Greens. He further said that the company is very excited to work together on this affordable housing project.
The HDFC Capital is targeting to extend established grade ‘A’ developers towards affordable and mid-income housing projects as the same will increase both supply as well as the construction quality.
The Runwal Group is the partner with global investors like Singapore’s sovereign wealth fund GIC and Capita-Land. The company’s Portfolio Management Services invested Rs. 500 crore in Runwal Group’s two projects in south Mumbai’s Nepean Sea Road and Mulund, Mumbai.
However, HDFC PMS walked out of the Nepean Sea Road project with a return of 24 percent and the Mulund one with 68 percent. This was a profitable walkout in India’s real estate market.
In 2018, HDFC Capital created a platform of worth Rs. Rs 2,500 for investment in affordable housing projects.