Lotus Green Red Ford Capital to invest Rs 1,000 crore-Upcoming New Projects in Yamuna Expressway

MUMBAI: Local private Equity fund Red Ford Capital will purchase a minority stake in various projects developed by residential real estate developer Lotus Green for Rs 1,000 crore in a year.

Lotus will develop two townships in Delhi, a senior company official said. Lotus Greeen also has interest in hotels, healthcare and education. "The PE firm will invest over Rs 635 crore in new projects that will be jointly developed with Lotus Green and rest Rs 365 crore will be invested in two existing projects which includes a township project Gurgaon and another on Yamuna Expressway,'' Lotus Green vice chairman P Sahel said.
Red Fort Capital will pick up about 50% stake in these projects from the conceptualisation stage, a person close to the deal said. "Since PE firm will be involved in the early stages, they will invest at cost. These projects will be in residential space that will be self liquidating and help on time exit for the PE firm in the next 4-5 five years from the start of the projects," he added.

The PE fund had raised about $800 million under two funds — $375 million in 2006 and $415 in 2009— to invest in real estate sector. "Some of the investors in the funds participated in the financing of the projects as it has given significant return. The first fund matures in 2016, and the second in 2018," said the officials.

The PE firm, which has around $200 million balance to invest, is in the midst of raising $750 million under its third fund by December 2013, one of the largest fund raise to invest in real estate developers. Red Fort Capital has invested in more than 20 residential projects which are developing $60 million square feet and until now they have exited 70% of its investments.