ASK holds $50m first close on maiden offshore fund

The real estate investment arm of Indian financial services company ASK Group has held a $50 million first close on its first offshore, blind-pool fund with commitments from three international investors, according to the firm.

Mumbai-based ASK is targeting $200 million for ASK India Real Estate Special Opportunities Fund, for which it began fundraising at the beginning of 2013 even as the firm admitted that fundraising for Indian real estate vehicles has been slow.

The first close included commitments from three institutional investors from Asia and Europe, he added. The firm has been talking to sovereign wealth funds, pension funds, family offices and funds of funds so far, and will also target investors in the Middle East and the US in addition to Asia and Europe as it seeks to hold a final closing by the end of 2014 or the beginning of 2015.

The firm raised two domestic funds in 2009 and 2012, reaching INR3.4 billion (€40 million; $55 million) and INR10 billion respectively. ASK Group managing director and chief executive Sunil Rohokale said the first of those funds is fully deployed across seven investments, and has already realized INR1.5 billion of its capital.

The firm has also committed INR5.4 billion of its second domestic fund across five investments. It also raised and fully invested an approximately $100 million mezzanine real estate debt fund onshore.

ASK’s offshore fund will follow the strategy of the firm’s onshore funds, Rohokale said, investing in residential developments in the five biggest cities of India – Mumbai, Pune, Chennai, Bangalore and New Delhi.

ASK has a INR 5 billion pipeline to be split between its second onshore fund and its offshore fund. Rohokale said that ASK should be ready to announce the first investment for the offshore fund in a month or two.

“The first hump is cleared with this first close and the investment soon to come,” he added. “So my hope is that the investors that were neutral before can become positive on investing in India.”

ASK is one of the few Indian blind-pool real estate funds to attract international capital since the global financial crisis with a number of large institutions opting instead to invest in the market via longer-term partnerships. Most recently, GIC Private made a $473 million commitment to a business space development, and the Canada Pension Plan Investment Board made its first real estate investment in the country by forming a $250 million joint venture with a local conglomerate.