HDFC enters tie-up with Prestige Estates for new housing project

HDFC (Housing Development Finance Corporation Limited) has entered into a collaboration with Prestige Estates, a real estate firm based in Bangalore, for a new affordable housing project. The joint venture will pump in approximately Rs. 2, 500 crore. The implementation of this joint venture has been through HDFC Capital Advisors Limited, a subsidiary which is the investment manager for HDFC Capital Affordable Real Estate Fund 1.

The fund emphasizes mostly on the affordable and mid-income housing categories. The fund already has a Rs. 2, 700 crore corpus that has been raised from investors globally. Real estate players and financial institutions like HDFC are tapping the affordable housing category since growth in other segments is lower in recent years. Prestige Estates has stated that a dedicated real estate platform will be formed as a result of this joint venture will have Rs. 2, 500 crore worth of capital inclusive of debt and equity.

There will be an expansion of the residential real estate business at Prestige Estates through the identification of strategic land parcels which have potential for the development of major realty projects in the mid-income category. The affordable housing sector has witnessed huge growth in demand and sales volumes. There are several opportunities that HDFC and Prestige Estates are considering in this space.

Prestige Group is one of the foremost realty players in South India with projects across Goa, Pune and Ahmedabad. The company has already completed 212 realty projects which encompass more than 81 million sq. ft. There are 51 on-going projects across multiple categories and the total area to be developed is 53 million sq. ft. There is also 48 million sq. ft. of upcoming realty ventures. The Prestige Group has a land bank spanning a whopping 424 acres and the potential area to be developed is more than 42 million sq. ft.