Kotak, ADIA expand tie-up with $590-mn fund to invest in office assets

 Kotak, ADIA expand tie-up with $590-mn fund to invest in office assets

Kotak Investment Advisors Ltd (KIAL), the alternative investments arm of Kotak Mahindra Bank, has formed a $590-million platform with Abu Dhabi Investment Authority (ADIA) to invest in India’s commercial real estate sector.

KIAL said it has closed its 12th real estate fund, which will be domiciled in Gujarat’s GIFT City. KIAL has so far raised, managed or advised more than $2.8 billion under its real estate fund series, it said in a statement.

The platform extends the partnership between Kotak and ADIA. The sovereign wealth fund of the Gulf emirate had previously backed a stressed assets fund managed by Kotak.

Vikas Chimakutty, the chief executive officer of the Kotak Reality Fund, said it had raised $1 billion over the past year to invest in the real estate sector in India.

“Strong demand for offshoring, return to office increasing, growth of the services industry and Indian economy has seen substantial scope for creating a portfolio of quality office assets” he said. “With multiple avenues for exit of such portfolios and increasing liquidity of completed assets, we intend to curate this portfolio to cater to increasing appetite for stabilised assets,” he added.

Long-term demand for office space in India is being driven by global organisations seeking to capitalise on the country’s skilled workforce and fund seeks to focus on opportunities associated with the same, said Mohamed AlQubaisi, executive director at ADIA’s realty department.

“This pool of equity capital expands our footprint in RE (real estate) investments with a focused strategy. This is the first of many pools of capital that we intend to raise this year to address various alternative investment opportunities in India,” said Srini Sriniwasan, managing director, KIAL.

KIAL was set up in early 2005 to bring a sharper focus to Kotak’s alternate assets practice. It has so far raised or managed over $5.7 billion across different asset classes including real estate funds, private equity funds, infrastructure funds, special situations fund, listed strategies and Investment advisory.

Aman Malik

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