Shriram Properties raises Rs 125 crore from LIC Housing’s arm for Bengaluru project



Shriram Properties

has raised Rs 125 crore from non-banking financial arm of

LIC Housing Finance

to develop a residential project in Bengaluru.

The funds will be used to construct Shriram Greenfield, a two-million sq ft residential project being developed across two phases in Whitefield, Bengaluru.

The company has so far sold more than 75% of the inventory in the first and second phases. “The fund is being used to replace one of the existing investment with lower interest rate,” said two people with direct knowledge of the transaction.

“The company recently gave exit to real estate private equity fund Motilal Oswal Real Estate from the above project, with a nearly two-fold return in less than four years,” said one of the person quoted above.

Private equity major TPG Capital and Starwood Capital-backed real estate developer Shriram Properties has in the past given exits to funds such as Ask Group, Sun Apollo and ICICI Prudentials with higher returns.

“The builder is working on some more exits which is expected to be completed over the coming quarter. So far the firm has received private equity investments worth $600 million, including project and entity level investments,” he added.

Some of the key investors in the company includes including TPG Capital, Starwood Capital, Walton Street Capital and Tata Capital that together hold around 60% equity in the company. These institutional investors had cumulatively invested total $270 million in the company between 2008 and 2014.

Shriram Properties is planning to raise about Rs 1,500 crore through its onitial public offering. The Bengaluru-based developer’s maiden share sale is expected to be concluded by March of 2019.

Shriram Properties is focussed on mid-income and affordable housing and has total 61.64 million sq ft of projects currently under construction and in pipeline across 38 projects.

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