HDFC Capital Advisors Ltd and an affiliate of Cerberus Capital Management LP have partnered to target the creation of a special situations platform focused on high-yield opportunities in Indian residential real estate sector.
The platform will seek to purchase inventory and provide last-mile funding for under-construction residential projects across India among other real estate-related opportunities.
The development of platform is in response to a series of shocks to Indian market that have created a significant need for capital. Many buyers have been unwilling to fund projects in advance of completion while traditional financing channels have come under severe pressure.
The platform intends to partner with quality developers to provide capital solutions and expedite project construction and completion.
HDFC Chairman Deepak Parekh said lack of buyer confidence in the ability of developers to complete projects combined with a slowdown in funding for real estate projects has resulted in developers being starved of capital to complete on-going projects.
“This platform in partnership with Cerberus has the potential to provide an impetus to real estate sector by providing capital solutions to developers and re-starting stalled housing projects,” he said.
Cerberus is a global leader in alternative investing with over 53 billion dollars in assets across complementary credit, non-performing loan, real estate and private equity strategies. It invests across the capital structure with a view to drive long-term value and has extensive experience working collaboratively across asset classes, sectors and geographies.
Frank Bruno, Co-Chief Executive Officer of Cerberus, said the company is able to provide tailored solutions in sectors with dislocated funding channels in various forms like the purchase of assets, creation of operating and lending platforms, and provision of structured capital to best-in-class operators.
“Together with HDFC Capital, we look forward to supporting high-quality developers and leading projects in one of India’s most important sectors,” he said.
HDFC had assets under management of Rs 5.5 lakh crore as of December 31, 2020 and has assisted over 81 lakh families own a home of their own. (ANI)