Private equity firm HDFC Capital secures International Finance Corporation (IFC) as the lead limited partner for an upcoming $1-billion real estate investment fund.

Private equity firm HDFC Capital secures International Finance Corporation (IFC) as the lead limited partner for an upcoming $1-billion real estate investment fund.

The HDFC Capital Development of Real Estate Affordable and Mid-Income Fund (H-DREAM) is a new private credit fund with a corpus of $1 billion, managed by HDFC Capital Advisors, the real estate private equity arm of HDFC Group. The primary goal of H-DREAM is to finance the development of sustainable, affordable, and mid-income housing projects across urban India.

The fund has a focus on implementing the EDGE (Excellence in Design for Greater Efficiencies) green building framework, adhering to global sustainability standards. This initiative aims to address the urban housing shortage in India, particularly in Tier 1 and Tier 2 cities, where an estimated 18 million housing units are needed, and about 275 million people (22% of the population) lack adequate and affordable housing.

The International Finance Corporation (IFC) has committed up to $150 million as an anchor equity investor in H-DREAM. This investment is designed to demonstrate the viability of innovative financing vehicles and mobilize long-term private capital for green housing solutions. The IFC's investment, along with potential additional capital from global and domestic institutional investors and Indian family offices, could mobilize up to $850 million of long-term capital to support this mission.

H-DREAM seeks to enable the development of at least 25,000 green-certified, affordable, and mid-income housing units. This will not only promote economic development but also environmental sustainability. The fund integrates sustainability with financing to build resilient communities, improve urban livability, and create jobs through the promotion of green affordable housing.

Meanwhile, other developments in the real estate sector include Blackstone's $1.4 billion India portfolio rollover, which is expected to generate significant gains for Asia and global PE funds. BlackSoil has also launched a Southeast Asia-focused credit fund, expanding its global footprint.

In addition, HDFC Capital is witnessing interest from global and domestic institutions and Indian family offices. HDFC Capital has four SEBI-registered Category II alternative investment funds. The combined platform of HDFC Capital's funds targets the development of affordable and mid-income housing in India, totaling $4.2 billion. Of this, $1.25 trillion will come from the residential sector.

In other news, Endiya Partners has roped in a former MassMutual executive as a venture partner. The platform aims to channelize global and domestic capital to address the housing needs in India. The strategy for FOUNT's Good Fashion Fund 2, LPs, India focus, and more have also been discussed in recent articles.

As 247VC nears the first close of its maiden fund, it's clear that the real estate sector in India is experiencing significant investment and development. With initiatives like H-DREAM, the goal of providing affordable and sustainable housing for millions of people in India is becoming increasingly achievable.

Investing in the HDFC Capital Development of Real Estate Affordable and Mid-Income Fund (H-DREAM) is aimed at financing the development of sustainable housing projects, particularly in Tier 1 and Tier 2 cities of India. This fund, with a focus on green building standards and affordable housing, seeks to develop at least 25,000 green-certified units to promote economic development and environmental sustainability, while concurrently addressing the urban housing shortage.

The International Finance Corporation's $150 million investment in H-DREAM is designed to mobilize long-term private capital for green housing solutions across India, potentially adding up to $850 million of long-term capital to support this mission. This initiative is one of many that indicate a growing trend of investors focusing on real-estate investments in India, such as Blackstone's $1.4 billion India portfolio rollover and Endiya Partners' strategic moves to channelize global and domestic capital for housing needs in India.

Read also: