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Bridging the funding gap: PE firms cash in on last-mile financing in real estate

70-80% of all realty funding is last-mile financing

PE firms cash in on last-mile financing in real estate

Last-mile financing by private equity (PE) firms has caught on in a big way among property developers, who are seeing prolonged slowdown in sales, fewer launches and lower cash flow. According to fund managers, 70-80 per cent of real estate funding in real estate is happening in this segment and PE funds are charging 16-24 per cent for this, depending on the developer's profile and security. Developers borrow money for a variety of reasons, including funds to complete projects where cash flows have dried up or to give exits to existing investors. Leading the race is Ajay ...