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HDFC sells 10% in realty fund arm to ADIA for Rs 184 crore

MUMBAI: HDFC has sold a 10% stake in HDFC Capital — a wholly owned subsidiary that manages real estate funds — to Abu Dhabi Investment Authority (ADIA) for Rs 184 crore. ADIA is also a primary investor with a $1-billion investment in the company’s affordable housing fund and has now picked up a stake in HDFC Capital.
The six-year-old company has a paid-up capital of only Rs 2 crore, which means that almost the entire proceeds of the sale will go to HDFC as a gain. “Supported by marquee global investors like ADIA, the funds managed by HDFC Capital have grown to create one of the world’s largest private financing platforms for the development of affordable housing. This investment by ADIA will enable HDFC Capital to leverage ADIA’s global expertise and experience to further propel HDFC Capital towards becoming a leading investment platform for global and local investors across multiple strategies and asset classes in real estate and technology ecosystem,” said HDFC chairman Deepak Parekh.
HDFC Capital is the investment manager for HDFC Capital Affordable Real Estate Fund 1 (H-CARE 1), H-CARE 2 and H-CARE 3, which are registered with Sebi as category-2 alternative investment funds. These funds combine to create a $3-billion platform targeting the development of affordable and mid-income housing in India.
Speaking to TOI, HDFC Capital MD & CEO Vipul Roongta said that the real estate cycle, particularly affordable housing, was seeing a huge turnaround. “In addition, there is a China-plus-one story of people wanting to come to India. Also, global investors are keen on tying up with a credible partner, particularly after the crisis in the NBFC sector a couple of years ago,” he said.
The funds managed by HDFC Capital provide long-term, flexible finance across the lifecycle of affordable and mid-income housing projects, including early stage funding. In addition, the funds will also invest in technology companies (construction technology, fintech, clean-tech, etc) engaged in the affordable housing ecosystem.
HDFC Capital’s target is to finance the development of one million affordable homes in India through a combination of innovative financing, partnerships and technology, while focusing on sustainability. To achieve this objective, the company is in active discussions with leading global investors to raise additional funds to be invested in the development of affordable & mid-income housing projects in India.




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