Century Real Estate Holdings, a developer based in Bengaluru had announced its foray into the alternate investment fund (AIF) market with the launch of its first AIF, TriVeda Capital is expected to reach its first close by June, according to P Ravindra Pai, Managing Director, Century Real Estate Holdings. The developer-agnostic fund will raise ₹200 crore.
Explaining the move to enter the space, Pai told businessline that there was a need for money managers in the real estate sector.
“We saw the opportunity to add value here as the financial experts, not the industry experts, handle a significant portion of the money management in the real estate industry, leading to more chances of causing mistakes because they view the industry more from a financial perspective without understanding the nuances at play.”
The company got the license last year and is putting up a professional team for the fund, which will focus on plotted development as they understand the business. “It isn’t a large fund size—ticket size is ₹1 crore—at this point, we will be looking at friends and family investors,” noted the MD.
In FY23, Century made an annual turnover of ₹500-600 crore and expects to scale its revenues to around ₹800-850 crore.
“We are looking at launching seven more residential projects and a plotted development project in May — an additional phase to an existing project. Additionally, we will add about 200 plots to an existing project, along with two more plotted developments in the pipeline. So, we have a good amount of work in our pipeline this year.”
Recently, the company also made an announcement that it intends to raise ₹1,000 crore which will largely be deployed in the upcoming commercial projects. According to the managing director, the company is currently in discussions and has received certain term sheets, which are expected to come to fruition within the next 1-2 months.
Commercial projects
The company is popular in the space of plotted developments, owns over 3,000 acre of the land bank across the city, and has been actively working towards diversifying into the commercial space as well for the last two years.
“While residential projects provide cash flow and are great as a cash flow business, commercial projects provide recurring annuities or income, which makes sense, and hence, we forayed into it the same.” Currently, there are over 20 million square feet of residential and commercial assets under construction in the city.
One of its ongoing projects is around 2 million sq ft, which comprises three towers: one is 7 lakh sq ft (0.7 million sq ft), and the other two are cumulatively 1.2 million sq ft.
“While the first tower will be handed over next month, the remaining two towers will be completed together in the second phase. And we’ve factored in around 3-4 lakh sq ft for a hotel that’ll come in the last phase,” he explained. The project is in collaboration with Godrej, which has invested ₹800 crore in the first tower.
Another project that is in development is with the Prestige Group, which has around 2.4 million sq ft. “We are in the advanced stages of receiving the final sanction. In this joint project, we will provide the land, while they will fund a part of the construction.”
Around 1.2 million sq ft or so will be Century’s share, and expect the sanction within the next 1-2 months or so. After that, it will take four years to complete the whole project.