Kotak Investment Advisors (KIAL) has secured $500 million as anchor investment from Abu Dhabi Investment Authority (ADIA) for its $1-billion real estate fund.
KIAL, the alternative asset arm of business conglomerate Kotak Mahindra Group, will use the proceeds from this fund to invest and support residential real estate in India’s five prime real estate markets. Located in Gujarat’s GIFT City, the 13th real estate fund by Kotak will open a channel of funding for prime residential projects in key markets.
The money raising for the fund is likely to be completed by this year and the fund may be launched in early 2023. The new fund is an opportunistic fund which can invest across various realty asset classes and capital stack, both debt and equity, said Kotak realty fund CEO Vikas Chimakurthy.
With this new fund, KIAL has raised, managed or advised more than $3.3 billion under its real estate fund series, he adds.
“With the first close of this fund, KIAL has raised around $1.5 billion in real estate across multiple strategies in around one and a half years,” Chimakurthy further added.
Part of the Kotak Mahindra Group, Kotak Investment was founded in 2005, and has so far raised $6.3 billion in fundraising. In June this year, Kotak Investment set up a real estate-focused $5.30-million platform in association with ADIA. According to Bloomberg Billionaires Index,
Uday Kotak is the ninth richest man in India, with a net-worth exceeding $13.9 billion.
Established in 1976, Abu Dhabi Investment Authority, sovereign wealth fund of the gulf emirate, invests on behalf of the Abu Dhabi government. ADIA is also a limited partner investor in Kotak Special Situations Fund.
“This agreement extends our existing and longstanding relationship with Kotak. The new platform is primarily targeted at the significant demand for housing in India, which is driven by sustained economic growth and a shortage of urban housing clusters,” said Mohamed AlQubaisi, executive director of the Real Estate Department at ADIA, told VCCircle.