Additionally, in its statement, the company said, H-CARE 3 will also invest in technology companies (construction technology, fin-tech, sustainability-tech, etc.) engaged in the affordable housing ecosystem.
Deepak Parekh, Chairman – of HDFC said, "Despite the recent headwinds in the global macro landscape, I continue to be optimistic about the demand for homes in India. As the pivot of global growth shifts, India is envisaged to remain amongst the fastest growing major economies In India and housing will play an even more important role as a catalyst for growth."
Parekh added, "HDFC Capital has been one of the pioneers of investing in affordable and mid-income housing projects in India. With the support of leading global investors like ADIA and partnerships with trusted developers, the HDFC Capital platform is well on its way to achieving its medium-term goal of funding one million affordable homes in India."
Meanwhile, Vipul Roongta Managing Director & CEO, of HDFC Capital said, “Urbanization is an irreversible trend in India which combined with the thrust given to affordable housing by the government will result in an exponential growth in the demand for affordable and mid-income homes."
Under the affordable housing schemes, HDFC will be the sponsor and HDFC Capital will be the investment manager for H-CARE 3 Schemes 1 and 2.
Notably, investors and sponsor have committed currently $376 million to H-CARE 3 Scheme 2. Further, H-CARE 3 Schemes 1 & 2 combine to create a total estimated fund corpus of $2.2 billion (including potential reinvestments) making H-CARE 3 one of the largest funds raised to invest in the residential real estate sector in India.
That being said, H-CARE 3 Scheme 2 combined with H-CARE 3 Scheme 1 (raised less than 1 year ago) and HDFC Capital Affordable Real Estate Funds – 1 & 2, raised in 2016 and 2017 respectively, creates a $3.1 billion funding platform which has been rated as one of the world’s largest private finance platforms focused on the development of affordable housing.
It needs to be noted that the primary investor in H-CARE 3 Schemes 1 & 2 is a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA).
Mohamed AlQubaisi, Executive Director of the Real Estate Department, ADIA, said, “Through the H-CARE funds, HDFC has established a successful track record of supporting the development of new affordable residential stock across the country. Our latest investment in the H-CARE platform aims to support its growth as it continues to meet the growing demand for early-stage financing of housing projects in India."
H-CARE 3 has the flexibility to give equity funding for real estate projects. Also, investors can invest in tech companies (construction technology, fin-tech, sustainability-tech, etc.) that address the needs of the affordable housing ecosystem.
The funds are expected to be committed towards investments over the next 3-4 years.
HDFC Capital’s target is to finance the development of one million affordable homes in India through a combination of innovative financing, partnerships, and technology, whilst focusing on sustainability.
HDFC Capital is the real estate private equity arm of HDFC Group. HDFC Capital also seeks to promote innovation and the adoption of new technologies within the real estate sector by investing in and partnering with technology companies.
