PropShare Capital launches second fund PREF II; plans to raise Rs 500 crore
PREF II will also focus exclusively on completed class-A income-generating commercial real estate leased to multinational and blue-chip tenants in the tech hubs of India. The proposed fund will also have a Rs.
200 crore green shoe option.
“The current high inflation and interest rate environment has increased yields on all asset classes including commercial real estate. Since yields are inversely proportional to asset prices, this has led to high-quality Class A offices being available at distressed prices.
Developers are under pressure as high interest-bearing debt used to purchase land or fund construction is putting severe pressure on cash flows, forcing them to raise capital by monetising assets. Given the softness in the investing environment and lack of capital providers, only the highest quality assets are currently tradable.
This has opened a unique one-time window for opportunistic investors to acquire quality Class A assets at above-market yields,” said Kunal Moktan, CEO and Co-founder, PropShare Capital.
According to the company, PREF I has been fully deployed across four office assets in Bangalore and Mumbai which are 100% leased to Grade A tenants like LG, Tata Finance and 24/7 AI.
The Indian office market is forecasted to perform strongly on the back of increased outsourcing in the aftermath of the recession in the West which is driving multinationals to open new or expand existing Global Capability Centres (GCCs) in India which offers up to 7-8x lower costs. Domestic technology companies are also expanding aggressively with most large companies now asking employees to return to the office fuelling the demand for office space.
The fund is targeted at institutional investors, HNIs, family offices, and
