Real estate fund managers float schemes for construction finance

Construction from AIFs will be at a higher rate than banks and NBFCs, which are currently not putting in money

Property fund management arms of Motilal Oswal, Indiabulls, and others are launching funds/schemes to lend construction finance to real estate developers.

With non-banking financial companies (NBFCs) almost stopping new lending and banks becoming selective, there has been a huge gap in construction finance over the past two years, fund managers said.

Indiabulls Asset Management is in talks with global investors to float a joint venture to lend construction finance to developers, said Ambar Maheshwari, chief executive officer (private equity).

Maheshwari said the Indiabulls fund had been financing construction since the inception of the fund, and it slowed during 2017 to 2020 and that