Sundaram Alternates, a subsidiary of the Sundaram Finance group, announced the launch of Sundaram Alternative Opportunities Series — High Yield Secured Real Estate Fund IV (‘RE Credit Fund IV’).
The fund will raise up to Rs 1,500 crore to invest in real estate. Essentially, it would invest in “key south Indian micro-markets and opportunities in last-mile financing”, according to a press release.
About 75 per cent of the fund’s allocation would be directed to projects with visible cash flows post approvals; the rest would be for “tactical or opportunistic investments that provide higher returns to boost portfolio performance”, the release says.
The ‘RE Credit Fund IV’ seeks to raise Rs 750 crore with a greenshoe option of Rs 750 crore, taking the target size to Rs 1,500 crore. The fund will target gross deal returns of 18-22 per cent. The focus will be on deals under Rs 100 crore and tenor of 3-4 years.
