HDFC Capital Advisors Ltd. and an affiliate of Cerberus Capital Management L.P. have partnered to make investments in under-construction projects facing fund crunch.
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 the platform is in response to a series of shocks to the Indian residential real estate market that have created a significant need for capital,” the partners said in a joint statement.
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 projects construction and completion,” the statement 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 ongoing projects. This platform has the potential to provide an impetus to the real estate sector by providing capital solutions to developers and restarting stalled housing projects,” said Deepak Parekh, chairman, HDFC Ltd.
Frank Bruno, co-CEO of Cerberus, said, “We are able to provide tailored solutions in sectors with dislocated funding channels in various forms, such as 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 projects in one of India’s most important sectors.”
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