Piramal Fund Mgmt exits luxury projects for Rs 500 crore

The company says it managed to exit at an IRR of 24% despite the slowdown in the realty market

Private equity firm Piramal Fund Management today said it has exited its investment in a luxury residential project of realty player Omkar in Mumbai for almost Rs 500 crore.

"We had invested around Rs 200 crore in Omkar's luxury project Omkar 1973 in Worli in 2011. Though there is a slowdown in the realty market, we have managed to exit our investment at an internal rate of return (IRR) of 24 per cent, which is around Rs 500 crore," company's Managing Director Khushru Jijina told PTI here on Wednesday.

The investment was made by Indiareit Domestic Scheme IV, which was raised in June 2010 with a Rs 922 crore corpus completely deployed across eight transactions.

"We have managed to partially exit from three investments. This is our fourth one which is a complete exit. By the end of the next quarter, we will exit another project, which we expect to fetch a return of above 22 per cent," he said.

The company has already returned Rs 106 crore from three partial exits - two of which are self development projects being carried out under the 'Address Makers' brand in Whitefield and Electronic City, Bengaluru and the third being interest payments received from an investment with the Marvel Group in Pune.

The company also plans to make partial exits from one more project during the period. "With this, we expect to return almost 75 per cent of the investments made so far to our investors with a good IRR by December-end," Jijina said.

He further said the company may raise another domestic fund to invest in mid-income projects. "We have planned to raise another round of domestic fund, which will be focused on mid-income projects. We are working on the proposal and may be we will finalise the plan soon. At the same time, we are also raising project specific funds.