IL&FS Milestone realty fund widens asset base

Last Updated: Sun, Apr 17, 2011 19:50 hrs

IL&FS Milestone Fund, promoted by IL&FS Investment Managers and Mumbai-based Milestone Capital Advisors, has invested around Rs 100 crore in a commercial property in Bangalore.

The fund house, with a corpus of Rs 3,500 crore has three funds — one focussed on real estate, another one for education and healthcare, while the third looks at investments in other sectors.

The realty fund, which has Rs 1,800 crore assets under management invests across three asset classes (residential/commercial / warehousing), is understood to have acquired the property in Bangalore recently. IL&FS Milestone Fund I (Rs 525 crore), and IL&FS Milestone Fund II (Rs 525 crore) have the mandate to invest in commercial office space and ITeS parks.

“The fund house has invested around Rs 100 crore to acquire the property in Electronics City in Bangalore. It, at present, has been rented out to an IT company, CGI, as part of the leasing arrangement,” industry sources familiar with the development said. The total area of the commercial building is 181,161 sft and has been acquired from a local developer, they added.

The realty fund manages a total of six funds focussed on various assets classes — two funds dedicated for rental yielding commercial properties, another three for residential segment, and one focused on warehousing with a corpus of Rs 8 crore.

In addition to the recently-acquired property in Bangalore, the fund house has commercial buildings in Mumbai, Kolkata, Pune, Chennai and Bangalore under its portfolio along with few mid-segment residential properties.

It follows an ‘active management’ principle seeking better return on investments. Typically, the fund house has an investment horizon of five years on real estate properties. “It is likely that the fund house will take a three-to-five-year view on Bangalore property before exiting,” the sources said. They also said the PE fund was looking for more investments in commercial properties with the up tick in the IT industry.

Earlier, the fund house had acquired a 74 per cent stake in HCC park, a 1.8 million sft commercial property in Mumbai worth Rs 775 crore.

IL&FS Investment Managers Limited (IIML), a subsidiary of Infrastructure Leasing & Financial Services Limited (IL&FS), is one of the oldest and largest private equity fund managers in India, with over $2.8 billion under management.

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