Xander Finance, the non-banking finance company (NBFC) of alternative investment firm The Xander Group, has invested Rs 130 crore (around $20 million) in the residential projects of Bangalore-based developer Adarsh Developers, according to a media report.
The investment has gone for the development of villa projects in and around southeast Bangalore. A large part of the funding has already been disbursed while the rest will be used as per the need of the developer.
The deal was closed recently, The Economic Times reported.
Xander has been an active debt investor in the real estate space. Over the years, it has also expanded its presence to other sectors such as education, manufacturing and financial services. In the education space, it has put in money in companies such as MT Educare and JGI Group.
In the real estate space, it has backed developers such as Orris Infrastructure, Mahaveer Group, Supertech and Prateek Group.
Debt funding has been an important source of capital for real estate developers across the country. Given the sluggishness in the market, especially in the housing segment, developers are increasingly relying on debt funding from NBFCs and private equity firms to stay afloat.
According to VCCEdge, the data research platform of VCCircle, the January-March period of 2017 recorded 18 debt deals in the sector compared with nine equity deals in the year-ago period.
Given the opportunity, NBFCs and private equity investors-turned-lenders have ramped up their debt funding activity. Altico Capital has been actively investing across residential and commercial segments and has an aggressive investment target of Rs 4,000-5,000 crore a year.