ASK Property Investment Advisors (ASK PIA), the real estate private equity arm of financial services company ASK Group, has invested Rs 150 crore ($21 million) in a residential project of developer Gulshan Homz, it said in a statement.
The project, which is spread over an area of 1 million sq ft, is located adjacent to Noida Expressway.
The company said that the investment is in line with ASK PIA’s strategy of providing controlled capital to projects to ensure project execution.
Noida-based Gulshan Homz has so far delivered over 7 million sq. ft. of real estate, of which 5.5 million sq. ft. in Noida and additional 4 million sq. ft. under construction in Noida and Greater Noida.
Amit Bhagat, managing director and chief operating officer at ASK Property Investment Advisors, said this is our maiden exposure with Gulshan Homz and the group fulfils our criteria of quality construction, delivery track record and reputation and brand name.
“Noida’s excellent infrastructure, relatively low lease rentals and proximity to Delhi will continue to drive its commercial real estate growth in the coming years,” he said, adding that an operational metro is an added advantage and the upcoming airport at Jhewar will change the dynamics of this market.
“Green shoots of revival are already visible in the residential real estate segment especially in projects of reputed developers having a track record of timely delivery”, said Sunil Rohokale, managing director and chief executive officer, ASK Group.
“With the Union Budget 2019 providing a push on the demand side for infrastructure and housing, demand will continue to see an uptick led by improved consumer sentiment, RERA implementation as well as reduced home loan interest rates”, he added.
The investment comes at a time when developers are facing major liquidity crisis. Residential real estate developer has been borrowing heavily from NBFCs and debt platforms for the last many years but that has now stopped given the liquidity challenge they face post IL&FS crisis.
Rising level of NPAs and defaults in the books of NBFCs has led to a situation where these debt platforms are finding it difficult to raise capital themselves. This in turn has made them extremely cautious in lending to developers.
The current situation of housing market has made it worse for all the stakeholders in the ecosystem.
In its latest offerings, ASK PIA raised its third domestic fund of approximately Rs. 1,400 cr. in 2016 and announced final close for its structured equity fund of approximately Rs. 920 cr. in March 2019.
Earlier, the real estate private equity arm raised its first domestic fund of Rs 326 crore under tough market conditions in the period from March 2009 to December 2009. It raised a second domestic fund of Rs 1,000 crore in 2011 and a third domestic fund of Rs 1,400 crore in 2016.
ASK Group has also raised Rs 500 crore ($82 million) for its maiden offshore fund. The company also raised structured debt of over Rs 575 crore for some of the most reputed and financially prudent developers which are fully prepaid.
In recent times, ASK Group invested in a bunch of projects of southern real estate developer Shriram Properties and also created a platform with the developer. The group had also backed a commercial project of ATS Group, marking its first investment in the commercial space.
In March 2018, it announced the final close for its structured equity fund of Rs 898 crore.
In March this year, ASK Property invested Rs 326 crore ($47 million) in the projects of QVC Reality Developers, Tridhaatu Realty and TVS Emerald, which is part of the TVS Group.
Recently, it also invested Rs 350 crore ($50 million) in a bunch of projects of two Pune-based real estate developers.
