ASK Property Fund, the real estate investment arm of Blackstone-backed ASK Group, has exited its investment in a plotted development project, where it first invested over two years ago, it is learnt.
The real estate credit investor, led by chief executive Amit Bhagat, has exited the investment where ASK Property Fund participated in a stressed asset funding alongside its co-investment partner, Shriram Properties.
ASK Property Fund and Bengaluru-based Shriram Properties invested about Rs 85 crore in plotted development project Shriram Pristine Estate via their Rs 500-crore-co-investment platform. The stressed asset, then called Golden Ira, developed by Golden Gates Group in North Bengaluru, was launched in January 2023.
According to a company statement, ASK Property Fund has realised an internal rate of return of about 20% on its investment, with an MOIC (multiple on invested capital) of about 1.24x in about 18 months of investment.
The typical tenure of plotted development investments is 2-3 years, much shorter than that of high-rise or apartment sales as these assets have a shorter self-liquidation period.
In December 2022, the co-investment platform jointly acquired the project from the lending entities of the IIFL Group, with capital commitments of up to Rs 125 crore. This was the platform’s maiden investment.
“This investment is a classic example of an opportunity arising from industry consolidation, as robust sales ensured a successful exit for us. This is part of our platform agreement with Shriram Properties, and we intend to participate in their expansion and growth in the near future,” said Lakshmipathi Chockalingam, managing partner - South, ASK Property Fund.
So far, the joint co-investment platform has only made one more investment, announced in last August. The platform invested about Rs 206 crore in the project – Shriram 122 West, located in Chennai and launched in January this year.
These funds were used to complete the acquisition, while the proceeds for the project’s working capital requirements were to be infused separately.
ASK Property Fund made the investment out of its investment vehicle Real Estate Special Opportunities Fund IV (RESOF IV), a Rs 1,500-crore alternative investment fund (AIF), closed in May 2023.
The fund marked its final close after downsizing the corpus from Rs 2,000 crore earlier. Through this fund, ASK Property Fund aims to finance mid and affordable residential real estate projects across key markets including Mumbai, Pune, NCR, Bengaluru and Chennai.
