Abu Dhabi Investment Authority to invest $250 million in Hines India Real Estate
in Property Time |Property News !
Wed Dec 11, 2013 10:52 am
Abu Dhabi Investment Authority is investing $250 million ( Rs 1,500 crore) in Hines India Real Estate, the Indian arm of American property development and management firm Hines, amid a rise in overseas interest in the sector.
The sovereign wealth fund owned by the emirate of Abu Dhabi recently invested $300 million (Rs 1,800 crore) in the offshore fund of Kotak Realty Funds run by Kotak Mahindra Bank. The money will be used to invest on behalf of the sovereign fund in the Indian real estate sector. The cash-rich sovereign wealth fund has so far invested more than $500 million in India, largely through realty or private equity funds.
Abu Dhabi has been scouting for opportunities to invest directly in the Indian real estate sector. It is now backing Hines to foray into the residential market and is targeting mid-market and upper mid-market residential development," said the person cited above. The company will first enter Mumbai and then the Delhi-National Capital Region.
The Abu Dhabi fund has also appointed Aditya Bhargava to look at investment options in India. Bhargava earlier served as managing director at SITQ India.
The move by the Abu Dhabi fund follows increased overseas investment in the sector. Qatar Investment Authority recently invested $300 million or Rs 1,800 crore in Bangalore-based real estate developer RMZ Corp to acquire commercial space in Bangalore, Hyderabad, Chennai and Pune.
Canada Pension Plan Investment Board has committed $200 million for an 80% stake in a joint venture company. The partners will jointly acquire foreign direct investment compliant office buildings in India's biggest cities.
"Deal momentum in the real estate sector is expected to increase in the coming year," said Sanjay Dutt, executive managing director for South Asia at realty consultant Cushman & Wakefield.
These deals are taking place in the backdrop of the Securities and Exchange Board of India's moves on introducing Real Estate Investment Trusts, he said.