Fire Capital ties up with US firm to start value housing projects

Promoters of real estate-centric private equity fund Fire Capital and America-based real estate investment and development firm, The Related Group of USA, are coming together to develop value housing projects in tier-2 and-3 cities. Both entities plan to invest Rs 6,000 crore on Astrum Homes over four years.

The projects — to begin with — will be operational in Punjab’s Amritsar and Haryana’s Panipat, at Rs 20-25 lakh per unit of about 1200 sq ft area each. Its initial capital investment willl be almost Rs 250 crore.

On why they planned to venture into developing from private equity, Astrum Homes chairman Om Chaudhry said the idea was not be make it a passive PE fund. “We actively want to participate in the sector, as we feel we can contribute much more this way,” he told a a conference to announce the venture.

 

Michael Targoff, a member of Astrum Homes board of directors, said the global investor interest had shifted to emerging markets and that India was a favourable investment destination due to its “significant” domestic demand.

Astrum Homes aims to have a pan-India presence in the next five years and a total developed area of 40 million sq ft. Chaudhry chose to call the ‘value housing’ projects as affordable luxury, and said each of the projects would be completed in two to three years. “We aim to cater to the demand of residential housing for middle and upper-middle income segments,” he added.

The 32-acre Amritsar project on the Bypass Road has an outlay of approximately Rs 300 crore and a total built-up area of 12 lakh sq ft.

The Panipat endeavour offers apartments totalling approximately 8 lakh sq ft with a project outlay of around Rs 200 crore.

“As household income in tier 2 and 3 cities is rising and people are looking for quality of life, as available in metros, we are confident enough that it would be able to deliver projects exceeding the customer expectations”, said Chaudhry.

Fire Capital Fund will not be investing in the project, the funding will be done by the shareholders of Astrum Homes.