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Motilal Oswal Real Estate secures two more exits from its fund IREF II in November

Mumbai 14-Nov-2017

Motilal Oswal Real Estate secures two more exits from its fund IREF II in November

Mumbai, 10 November 2017: India Realty Excellence Fund II (IREF II), the second real estate fund by Motilal Oswal Real Estate (MORE) has successfully exited two more investments in the month of November 2017. With these 2 exits, the Rs. 500 Cr. fund has now completed 6 full exits out of the total 14 investments.
IREF II achieved its final close in April 2015 at Rs. 500 Cr. and has till date made 14 investments amounting to ~Rs. 670 Cr. (including re-investments) and with these 2 recent exits, has completely exited 6 investments at an average IRR of 25.7%. Within 2.5 years of its final close, the fund has divested ~108% of the fund size and returned ~64% of the money back to the investors. The two recent exits have been from investments with Skylark Mansions and Mahaveer Developers in Bangalore. IREF II has been the better performing funds amidst a tough real estate market and the fund has also been awarded the “Real Estate Fund of the Year – Domestic” at the CNBC Awaaz Real Estate Awards 2016-17.
India Realty Excellence Fund III (IREF III), the third real estate fund by MORE which achieved its final close in August 2017 at Rs. 1031 Cr. is currently in investment phase and has committed more than 80% of the capital.
Mr. Sharad Mittal, Director & Head of Real Estate Funds at MORE said “The last 3-4 years have been tough for the real estate sector with developers battling low sales velocity and low consumer confidence. However, our strategy of partnering with dominant players in each micro-market and focusing on mid-income housing projects (prices ranging between Rs. 4000 – 6500 psft) has played out well for us.” 
MORE has forged strong relationships with their development partners by providing them capital at the right stage (early stage investments). This is reflected through the multiple transactions that it has executed across its three funds in the past 4 years. Eg) Casagrand Group – 7 investments (Chennai), ATS Infrastructure – 4 investments (Delhi-NCR), Rajesh Lifespaces – 3 investments (Mumbai), Shriram Properties – 2 investments (Bangalore)
“Structural changes in the form of RERA and GST have been introduced to the sector in the past year leading to increased compliance on the part of developers. Consolidation is already being witnessed in the industry post these changes and the industry shall gradually progress towards broader institutional ownership and we believe that our kind of capital shall become much more suited to developers going forward,” said Mr. Mittal.
MORE, a subsidiary of Motilal Oswal Private Equity (MOPE) is the real estate private equity arm of Motilal Oswal Financial Services (MOFSL). MORE till date has invested capital in the real estate sector through three real estate funds and NCDs/ Prop investments. Today, cumulative AUM under MORE stands at more than Rs. 2,000 Crs spread across IREF (Rs. 200 Cr.), IREF II (Rs. 500 Cr.), IREF III (Rs. 1,000 Cr.) and balance under NCDs / Prop Investments.
About Motilal Oswal Real Estate
Motilal Oswal Real Estate Investment Advisors Pvt. Ltd. (MORE) was founded in 2008 as a 100% subsidiary of MOPE Investment Advisors Pvt. Ltd. (MOPE) – the Private Equity arm of Motilal Oswal Financial Services Limited (MOFSL). MORE is currently managing three real estate funds, namely India Realty Excellence Fund (IREF), India Realty Excellence Fund II (IREF II) & India Realty Excellence Fund III (IREF III) along with NCD/ Prop Investments. Today, cumulative AUM under MORE stands at more than Rs. 2,000 Cr. IREF, launched in 2008 is a ~Rs 200 Cr domestic real estate fund focused on equity investments in real estate projects in top three cities in India viz. Mumbai, Pune and Bangalore. IREF has made 7 investments and secured 4 full exits and 3 partial exits. On the back of its success, MORE launched IREF II - a Rs 500 Cr domestic real estate fund. IREF II has been fully committed and has invested with established developers such as Ahuja Constructions, ATS Group, Casa Grande, Shriram Properties, Kolte Patil etc. IREF II has made 14 investments till date and secured 6 full exits at an investment level IRR of more than 25%. The third fund, IREF III is a Rs. 1000 Cr domestic real estate fund focusing on early stage structured/ mezzanine investments. Currently in deployment stage, IREF III has made 12 investments across the top 6 cities in India with established developers and is 80% committed.
About MOPE Investment Advisors Pvt Ltd:
MOPE Investment Advisors Pvt. Ltd. (MOPE) is a subsidiary of Motilal Oswal Financial Services Ltd. (MOFSL), a diversified financial services group with businesses in Securities, Asset Management, Private Equity and Investment Banking. MOPE is currently managing two growth capital funds focused on providing growth capital to mid-market companies, typically in the range of US$ 10-20 million, across sectors. Fund I, launched in 2007 is a INR 550 Crore ($ 115 million) fund and is fully invested in thirteen portfolio companies across sectors such as food processing, bulk packaging, power transformers and power infra enablers, ITES, financial services, EMS, FMCG, auto components, etc. It has already made eleven exits till date. On the back of its success of Fund I, MOPE raised Fund II, a Rs.1,000 Crore (~USD 155 million) growth capital fund. 
Fund II has completely been deployed across consumer, financial services, pharma and manufacturing sectors.

For Further Details Contact:

Rohini Kute
Head of Corporate Communications, Motilal Oswal Financial Services
Mob +91 9820196838
Mail: rohini.kute@motilaloswal.com

Alpesh Nakrani
Paradigm Shift Public Relations
Mob +91 98691 21167
Ph-   +91 22 2281 3797 / 98