ASK Property Fund earns Rs. 2,000 crore to invest for Real Estate sector in FY25

Blackstone-backed ASK Property Fund, the real estate private equity arm of ASK Asset & Wealth Management Group, is planning to secure more than Rs. 2,000 crore in third debt fundraising for investment in the Indian real estate sector by FY25, as per Amit Bhagat, the CEO and managing director, in an interview with Moneycontrol. 

This upcoming fundraising will mark the company's third debt-raising initiative and is scheduled to begin after the elections. The capital raised will primarily focus on five key markets—Bengaluru, Pune, Mumbai, and Delhi-NCR.

Furthermore, Bhagat mentioned that the company is contemplating significant investments in various other cities and towns across India, although specific details were not disclosed.

Recently the company is seeking private equity investments in the self-liquidating mid-income and affordable residential segments, as well as the commercial segment. ASK Property Fund has secured about Rs. 6,100 crore since 2009. The investor base involves family offices, ultra high net-worth individuals (UHNIs), HNIs and other institutions.

Bhagat mentioned that, the company is trying to exit at least one project every two to three months in FY25. He further quoted, "In the ongoing financial year, we are looking to exit at least four to six projects in the five cities we are active in. However, the majority of exits will be happening in Bengaluru and Pune."

The company declared the exit of Rs. 156 crore from Avon Vista, a project being developed by Naiknavare Developers Balewadi, Pune, on May 13. ASK Property Fund had invested Rs. 80 crore in this project in 2018.

The recent exit has achieved a targeted internal rate of return (IRR) of 21% and a 2x multiple of the capital invested. IRR demonstrates the profitability of an investment.

To date, the company has invested in over 12 projects in Pune covering a total area of over 16 million square feet. During the last month, an exit of Rs. 354crore from QVC Realty Developers in three projects located in Bengaluru and Gurgaon. The two projects in Gurgaon are located in the Dwarka Expressway catchment area, while the third project is situated in Nandi Hills, some 60 km from Bengaluru. The amount of investment was more than Rs. 200crore and the company clocked 1.8x multiples of capital invested with an IRR of about 20%.

Bhagat also mentioned, "This was a recapitalisation opportunity before the NBFC (non-banking financial company) crisis. By providing the requisite and flexible working capital, we ensured the project’s completion, supported by sales during the life of the project."