Kotak Realty Fund has floated two real estate funds with a corpus of Rs 3,000 crore. Kotak has raised Rs 1,600 crore through its domestic fund— Kotak India Alternate Opportunities Fund, while it is in the process of raising another 1,400 crore through an international fund.

According to the top company official, this fund has the flexibility to invest in both FDI and non-FDI compliant investment opportunities. These funds have investment objective to invest in diverse Indian real estate asset classes across commercial, residential, retail, logistics, warehousing and hospitality properties.

In 2005, Kotak Reality launched its first reality fund with a corpus of Rs 457 crore, which has been fully deployed. The fund has invested in Shobha Developers and Lemon Tree Hotels.

Company CIO V Hari Krishna said, “The reality sector in India is undergoing a dose of healthy correction, after the initial euphoria of over 18 months. While the correction is not an across the board phenomenon, there are still areas of short supply and financing constraints, which will provide the fund with attractive investment opportunities.”

A wise commercial investment can yield over 10% return and a steady property value increase could take this to around 50% per annum in markets like Mumbai and Delhi. Many HNIs and institutions are investing in commercial and retail spaces.

This News is From - The Economic Times dated 19th July
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