Book A Meeting
+91 95616 10108
WhatsApp Us
Book A Meeting
Fund Snapshot
| Investment type | Preferred Returns |
| Fund Type | Category II AIF |
| Commitment period | 12 (+6) |
| Management Fee | On capital called during the commitment period |
| Segment focus | Residential, Mixed-Use and Commercial |
| Investment Pipeline | 50% of investments pre-identified |
| Stage of Investment | Post approval |
| Fund Size | INR 1,000 Cr (Greenshoe option: INR 1,500 Cr) |
| Target Return | 21% Gross Investment XIRR^ |
| Tenure | 5.5 (+1+1) Years from final close |
| Commitment Period | 12 months from Final close + extendable by 6 months at the discretion of the Investment Manager |
| Hurdle Rate | 10% XIRR |
| Sponsor Contribution | 2.5% of the funds raised + USD 1.5 Mn (~INR 11 Cr) |
| Team Contribution | 1.0% of the funds raised |
Investment Strategy
- Investments in Top six cities (Mumbai – MMR, NCR, Bengaluru, Chennai, Pune & Hyderabad)
- Focus on job/ growth corridors
- Investments in affordable & mid-segment residential, commercial and mixed-use developments
- Sustainable developments goals
- Investments in preferred returns
- Control investments with a defined risk management framework
- Conservative underwriting approach with a margin of safety
- Investments at distress valuations
- Partnering with established strong regional developers
- Opportunistic allocation of asset segment and capital structure
- Invest in projects being Socio-Economic Value Accretive (SEVA)
Prudent Developer Selection
- Min 20 years of experience
- 5 Mn + sqft. delivered
- Execution capability
- Strong regional developers
- Strong sales franchise
- Superior land aggregation capability
- Sound financial track record
- Stakeholder satisfaction score
- Corporate Governance
- Accessibility – Management style
Risk Management Approach
- Capital structure
- Raising additional finance
- Charge on firm’s assets
- Business plan
- Appointment of project personnel, consultants, contractors, vendors etc.
- Marketing and Sales plan
- Change in cost structure
- Mortgage of land / Saleable area
- Personal Guarantee / Corporate Guarantee
- ~ 2 X security cover
- Change in specifications
Monitoring Mechanism
Conduct Monitoring Committee Meetings every 2 Months
Monitoring Committee comprises the following members:
- Company Promoter
- CEO/COO
- Head of Finance
- Head of Sales
- Head of Construction
- Head of Collections
- Head of Liaison
Participants from the ASK Group
- ASK PIA, CEO
- ASK PIA, CIO / Managing Partner (South)
- ASK PIA, VP/Sr. VP Asset Management
- ASK PIA, Investment Manager
Participants from External agencies
- Appointment of PMC (Project Management Consultant) and QS (Quantity Surveyor) by ASK for monitoring of Time, Cost and Quality
Core Investment Philosophy
- Prudent developer selection
- Top Six Cities (MMR; NCR; Bengaluru; Pune; Chennai & Hyderabad)
- Growth corridor drove by job creation in micro-markets
- Development stage & distressed opportunities
- Conservative underwriting – Margin of safety
- Controlled investments
- Asset management focus and monitoring
- Deep understanding of partner’s core values and operations
- Compounding opportunity
Investment Opportunity
Acquisition at Distress valuation
- Value acquisition from distressed sellers
- Haircut to existing investors/ lenders
- Weaker players surrender project/s to stronger ones
Mismatch of Cashflows
- Replace existing lender
- Fully approved projects
- Mid/Last mile funding
Working Capital Funding
- Low-cost debt from banks/HFCs
- Lease Rental Discounting (LRD)
Covid-19: Crisis and Opportunity
Commercial Real Estate
- Commercial rentals have been under negotiation for part/full wavier during the lockdown and renegotiations thereafter
- Dedensification of offices due to social distancing can accommodate <50% of capacity
- Ongoing deliberations regarding the future of working from home
Residential Real Estate
- A significant slowdown in sales, collections and construction
- Pre-covid levels reached in 2021
- Refinancing continues to be a challenge
Countercyclical opportunity
- End user demand for affordable and mid-segment housing still intact
- Government impetus through stamp duty reduction and low-interest rates
- Further consolidation will be a boost for well-capitalized brands
- Increased deal flow for preferred return opportunities with conservative underwriting and margin of safety
