Shapoorji Real Estate 750-Cr Debt Finance Deal

Shapoorji Pallonji Real Estate (SPRE) has reportedly raised $100 million (around Rs 750 crore) from non-banking finance company Asia Pragati. This is one of the biggest debt financing deals in real estate this year. SPRE has gone for structured debt financing at a rate of around 20 per cent. The NBFC normally takes two times cover on its loans to developers. Asia Pragati is part of Hong Kong-based global investor PAG. This deal assumes significance given the overall liquidity squeeze faced by developers as well as NBFCs. SPRE had to meet certain debt payment obligations that’s why they went for this deal. It has also taken moratorium on debt payments selectively. The deal comes at a time when NBFCs and housing finance firms are selling their portfolios to special situation funds. Covid-19 and lockdown have made developer loans even more risky for NBFCs. Though realtors can avail moratorium till August, they could struggle to repay money to lenders. According to a few reports, the Shapoorji Pallonji Group is in talks with Brookfield to raise $400 million to repay its debt obligations. The group is also looking to sell solar assets to toll roads. It has to repay about $950 million of debt by 2021.