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IREF III Funds Overview

India Realty Excellence Fund III

  • Fund Size : INR 1,000 Crore
  • Focus : Residential Real Estate projects in Indian Metros
  • Average Ticket Size : INR 80 – 100 Crore
  • Status : Active

India Realty Excellence Fund III (IREF III) is the latest fund offering by MORE with a target to raise Rs. 1,250 Crs. The fund is focused on investing in Tier 1 cities with a residential focus. The fund aims to generate superior returns through structured transactions accompanied with significant downside protection mechanisms. The fund is currently in the process of fundraising and has announced its second close in September 2016 at Rs. 850 Crs. The fund has received commitments from several HNIs in India and Middle East.

The Fund has also started deploying capital from this Fund and has deployed ~ Rs. 450 Crs till date across investments in Mumbai, Bangalore, Pune, NCR and Hyderabad.

Investment Strategy

  • City Strategy:

    Fund shall restrict its investment in top 6 cities of India - MMR, Delhi NCR, Bangalore, Pune, Chennai and Hyderabad. Investment in individual cities (except for MMR & Bangalore) shall not to exceed 40% of the fund size

  • Project Strategy:

    Investment shall largely be in residential projects which are self-liquidating in nature. In order to achieve the desired IRR, majority Investment shall be at land acquisition stage or pre-approval stage. Investment in a single project shall not exceed 25% of the fund size

  • Developer Strategy:

    The fund shall partner with established developer with good track record, superior execution capability and financially sound. Investment in a group shall not exceed 30% of the fund size

  • Investment Structure Strategy:

    The fund shall undertake structured equity investments and mezzanine investments. Fund plans to undertake structured equity transactions with established reputed developers in each micro market. Focus shall be to invest in mid-income housing residential projects with reasonable approval certainty. In case of mezzanine investments, structure shall be regular fixed coupon along with equity kicker in form of inventory or revenue share in the project.

Investment Snapshot as on 31st December 2016

Sr. No. Investment Date DeveloperLocation Committed Amount (in Rs. Cr.)Current Status
1 February 2016 Kolte-Patil Pune 41 Invested
2 August 2016 Pate Developers Pune 45 invested
3 September 2016 Garden City Realty Bangalore 55 Invested
4 September 2016 ATS Infrastructure Noida 45 Invested
5 September 2016 ATS Infrastructure Noida 45 Invested
6 October 2016 Rajesh Lifespaces
Mumbai 130 Invested
7 December 2016 Phoenix Infratech Hyderabad 80 Invested