Axis Mutual Fund will launch a Rs 1,500 crore alternative investment fund to part finance commercial realty projects under the partnership with US realtor Tishman Speyer. These projects will be developed across eight major metros.
The partnership will invest in early-stage or greenfield commercial real estate projects across the Mumbai region, Delhi-NCR, Bengaluru, Hyderabad, Chennai, Pune, Ahmedabad and Kolkata, Axis AMC said in a statement on Tuesday.
Since its inception in 1976, the New York-based firm has acquired, developed and operated a portfolio of over 217 million sq ft with a total value of over USD 126 billion, spread over 512 assets globally.
However, under this agreement, Tishman will be the exclusive development manager of the projects that will be developed under the partnership, and will not have any equity participation, said Ashwin Patni, head of products and alternatives at Axis AMC.
Tishman entered the country in 2010, launching Waverock IT Park in Hyderabad, which houses TCS, Accenture, DuPont and Capgemini, among others. It owns/manages around 4 million sq ft of office space in various cities now.
Patni also told PTI that to part-finance the proposed projects, the fund house is shortly launching a category II alternate investment fund (AIF) worth Rs 1,500 crore for which it has already received regulatory approvals and also begun conversations with prospective investors.
The proposed fund will be closed towards the end of the fiscal, he added.
On the rationale for the realty AIF, the fund house said it is confident of the long-term potential of the commercial real estate in the country as the past six to eight years have seen significant activity and deepening of secondary markets in commercial real estate through participation by both institutional and retail investors.
“The resilience of this asset class has been evident through the improved demand in 2022. We believe that this is an opportune time to create a platform to cater to the discerning demands of the occupiers.
“The platform is uniquely placed to achieve its objectives by leveraging Tishman Speyer’s capabilities in design, development, and property management with deep experience in developed markets, Amitabh Chaudhry, managing director and chief executive of Axis Bank said.
Tishman Speyer chief executive Rob Speyer said the partnership will produce high-quality office space for local and global companies and the partnership is looking forward to exploring potential opportunities in key markets, such as Mumbai, Pune, Bengaluru, Hyderabad and Delhi-NCR.
Axis AMC MD and CEO Chandresh Nigam said that with this initiative, we are creating a market-leading alternatives platform that provides unique non-correlated investment avenues. Although the market has products focusing on rent-generating commercial assets, our platform will provide a unique opportunity in the development stage of commercial assets.
The proposed AIF will be led by Balaji Rao, managing partner — real estate, at the fund house.