Altico Capital invests $27m in real estate firm Pharande Group

July 11, 2016

Non-banking finance company (NBFC) Altico Capital India Pvt Ltd has provided debt of Rs 180 crore ($26.8 million) to real estate firm Pharande Promoters & Builders Pvt Ltd. The deal was closed in June 2016.

The investment has been made against two brown-field residential projects named ‘L-Axis’ and ‘Woodsville-III’ in Pune. Pharande Promoters will use the funding for refinancing an existing lender and for construction of the projects.

"The locations of the respective projects, the product offering and current stage of development were key reasons for Altico’s interest in the projects. Pune is a key market for us. Earlier in the quarter we had completed a Rs. 240 crore transaction with the Marvel Group. Now, in addition to the Pharande transaction we plan to deploy an incremental Rs. 400-500 crore in the next couple of months with developers focused on delivering mid-income and affordable residential projects," said Sanjay Grewal, CEO, Altico Capital, in a statement.

Law firm Khaitan & Co acted as the sole advisor to Altico Capital on this deal.

This comes at a time when PE firms are providing capital in the form of debt in real estate sector unlike the 2008 when most had invested in return for equity. India Infoline Asset Management Company (IIFL AMC) is raising a Rs 750 crore debt fund under India’s first Category III AIF (alternative investment fund) real estate fund. Indiabulls Alternative Investments Ltd, and IDFC Alternatives are also raising new funds.

Pharande Spaces has completed nine residential projects in Pune, as per its website. In 2014, the real estate company had launched a luxury township project at Pune.

Altico Capital operates as a subsidiary of India Credit Pte. Ltd. It is backed by Clearwater Capital Partners, Varde Partners and Abu Dhabi Investment Council.

The company focuses on senior secured lending to mid-income residential projects and commercial real estate across tier 1 cities in India. It also provides structured finance solutions to the infrastructure and other adjacent sectors.

As reported by DEALSTREETASIA, Altico Capital is raising a $300 million real estate fund to invest in residential projects.

The firm has invested over $40 billion in India since its launch in January 2004 as Clearwater Capital Partners. It recently invested Rs 575 crore in three companies including Unishire Urbanscape Pvt. Ltd, Marvel Group in Pune and Midcity Infrastructure Pvt. Ltd.

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