Singapore’s sovereign wealth fund Government of Singapore Investment Corp (GIC) and its government owned investment firm Temasek Holdings are set to invest in $500 million real estate vehicle that is being set up India’s Housing Development Finance Corp Ltd (HFDC), a report said.
The fund will begin approaching investors early next year and expects to generate returns of 21 per cent over its seven-year life by investing in residential projects in western and southern India, the report added.
The fund aims to achieve its first close of about $200 million soon, and final close of another $300 million within the next couple of months.
Recently, India had relaxed foreign direct investment (FDI) rules in the real estate sectors and allowed investors from abroad in projects that have a minimum built-up area requirement of 20,000 sq m as compared to 50,000 sq m earlier, even as the initial capital required was halved to $5 million. India has also allowed 100 per cent FDI in real estate projects.
India media recently reported that former chief executive officer of Citigroup Inc, Vikram Pandit, had invested $90 million in FICS Consultancy Services Ltd, a firm that specializes in lending to real estate developers, and is a unit of Mumbai-based financial services company JM Financial Ltd.