New Delhi, May 22 -- ASK Property Fund, the real estate investment arm of private equity firm Blackstone-backed ASK Group, said Thursday it has marked the first close of a new vehicle that invests in luxury housing projects after raising half the target corpus.
The fund, led by chief executive and managing director Amit Bhagat, has raked in Rs 500 crore for the first close of the vehicle that was floated in partnership with India Sotheby's International Realty in January.
The ASK Curated Luxury Assets Fund I has a target corpus of Rs 1,000 crore and an additional greenshoe option of Rs 500 crore. The investment firm expects to raise a cumulative Rs 1,500 crore for the fund's final close. The firm plans to wrap up fundraising for the vehicle by the end of the calendar year, a person aware of the development told VCCircle.
The fund counts ASK Property Fund and India Sotheby's as its co-sponsors, though they haven't disclosed the capital they contributed.
"The fund benefits significantly from India Sotheby's capability to monetize projects through its extensive network, experience, and access to premium land parcels. We believe the fund can secure exclusive deals for our select developer partners via curated opportunities and maximize returns through well-structured investments," Bhagat said.
The capital for the initial close was raised from family offices and ultra-high-net-worth individuals (UHNIs). The equity fund has a mandate to invest in high-end and luxury real estate developments in Tier 1 cities and premium holiday home destinations. It aims to garner returns from the profit margin of the projects it invests in and is targeting a return of at least twice on invested capital.
"With the luxury residential market now entering a more mature phase, and the initial exuberance beginning to stabilise, we're confident of striking smarter, better-valued deals with landowners and developers alike," said Amit Goyal, managing director at India Sotheby's.
ASK Property Fund dabbled in the luxury housing market with a handful of deals last year before the launch of this dedicated fund in January this year.
Among its luxury housing bets, ASK Property backed a residential project in Gurugram along with Shapoorji Pallonji Real Estate and the property arm of Kanodia Group last month. The entities together invested about Rs 270 crore (around $31 million then) in the luxury housing project being developed by KREEVA, the real estate arm of Kanodia Group.
In its maiden luxury housing bet, ASK Property last February said it would infuse around Rs 120 crore in a project to be developed on Gurugram's Golf Course Road by TREVOC Group.
While this is a new strategy, ASK has been a long-time investor in India's residential real estate market with its flagship real estate credit scheme, Real Estate Special Opportunities Fund, with a focus on mid-income and affordable residential real estate. The investor has raised around Rs 8,000 crore since 2009 from limited partners.
Published by HT Digital Content Services with permission from VC Circle.