Rubi Arya, vice chairman and director, Milestone Capital Advisors Ltd
PE firm Milestone Capital Advisors Ltd, which focuses on residential and commercial projects, has launched its 10th fund that would focus on mid-size residential projects. Tata Investment Corporation is the anchor investor in the proposed Rs 500 crore fund, which is expected to see the first close in September end with around Rs 200 crore. The PE firm also said that it would look at launching its 11th fund, with a size of Rs 400-500 crore.
Rubi Arya, vice chairman and director, Milestone Capital Advisors Ltd said that the fund is expecting to close the first round by end of September, with about Rs 200 crore, while it will take another six months to raise balance money.
The Fund size would be about Rs 500 crore, with an upsize option of another Rs 200 crore, said Arya, adding that Tata Investment Corporation is the anchor investor of the fund.
Already six projects were identified for the proposed fund, said Alok Aggarwal, managing partner and CEO - real estate, Milestone Capital Advisors. He said 70 per cent of the fund would be towards debt and balance will be equity.
Target IRR is around 22-24 per cent in structured debt with or without equity upside and 26-28 per cent in hybrid equity structures, said Aggarwal, who noted tenure for the investor would be 3.5 years with provision for one year extension.
Navin Kumar, executive director, Milestone Capital Advisors Ltd added the fund will continue to focus in the five cities including NCR, Pune, Mumbai, Chennai and Bangalore. "Around 30 per cent of the allocation, in the 10th fund, will be for the Chennai market," he said.
Milestone Capital Advisors is also planning to launch its 11th fund, which will focus on commercial real estate projects, said Arya.
"We normally take a decision on the next fund in mid-way, on the ongoing fund raising process. So we will taking the process for the next fund, which would be around Rs 400-500 crore in the next six months," she said.
Milestone Capital Advisors manages eight funds, including six domestic and two overseas, in real estate space. These funds includes India's first REIT like structures as well as Bullion producitiy and portfolio management systems. The company raised and deployed around Rs 2,876 crore across the funds, Milestone has returned over Rs 1,650 crore (around 57 %) back to its investors.