In order to ensure sufficient fund flow to its on-going real estate projects across the country, Reliance AIF Asset Management Company has generated worth Rs.400cr in an initial close of its first real estate fund. The fund in question has invested across four transactions—one residential project each in Mumbai and Bengaluru and two in Chennai. Reliance AIF, a 100% subsidiary of Reliance Capital Asset Management Ltd, is factually raising a total of Rs.1,000cr under its first AIF initiative, Reliance Yield Maximiser Alternative Investment Fund Scheme 1 launched recently. The fund will further generate Rs.200cr, in a second interim close, within a couple of months. The target corpus of Rs.1,000cr will be fully raised by March, 2015, said head of project management services and alternative assets at Reliance Capital Asset Management, Shahzad Madon.
He further added that the company is receiving a very strong response for its offering. In the best interest of our investors, its priority has always been to raise only those funds which can be deployed in the highest quality assets in a timely manner. It may be recalled that the Reliance's new fund primarily invests in secured debentures and focuses on residential projects that are in an advanced stage of construction development, across the top metros, including Pune and the National Capital Region. The size of each transaction will be Rs. 40-120cr, with a 20-24% target internal rate of return. The real estate ventures will largely be city-centric where buyers are more easily available. The fund is likely to close approximately 15 transactions from the Rs.1,000cr corpus. In October, Crisil assigned a Crisil Fund Management Capability Level-1 rating to the fund that reflects the highest standards in fund management capability and investment process.