360 ONE-backed Neoliv raises initial ₹300 crore in first real estate fund

March 14, 2024

360 ONE-backed residential real estate platform Neoliv, founded by former MD and CEO of Godrej Properties Mohit Malhotra has raised ₹300 crore in its first fund, which has a total corpus of ₹1,500 crore. It will be used to buy land parcels on which plotted developments and mid-income high rises will come up.

This is the first equity-based real estate alternative investment fund in several years, since most funds are debt-based. Malhotra said that this would provide investors higher returns.

Land parcels to be acquired have already been identified in places such as Lucknow, Jaipur, Sonipat, Alibag, Chembur (in Mumbai) and in the western suburbs of Mumbai, Malhotra said. Discussions for their acquisition are at an advanced stage and at least one or two of them will be closed soon, Malhotra told reporters.

The AIF is looking to set up around 10 projects of which around 5-6 will be plotted developments and the rest will be residential high rises with apartments. Each of the projects would have developable area of 2-10 lakh sq ft.

‘Bouyant demand’

Malhotra, who has floated Neoliv with seven other partners and has wealth fund 360 ONE as a significant minority investor, said that he expected the boom in the residential market to sustain. “I expect the demand will be buoyant at least for the next 8-10 years.”

After a 10-year slump, the residential real estate sector has seen hyperactivity since 2021 with customers queuing up to buy houses as soon as they are launched. Inventory is at an all-time low of less around 15 months to sell on a pan-India basis.

The funds were raised from family offices and high net-worth individuals. Investors can expect returns from the second year of the project. Malhotra declined to give an indicative return but said that it would be above debt fund returns that are in the range of 16-18 per cent.

Neoliv has in-house capabilities for development and construction of the project reducing execution risk.

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