ABOUT BlackSoil Realty Fund

The Indian Real Estate sector has seen significant growth in recent past and is expected to reach a size of US$ 180 Bn by 2020.

Growth in Indian real estate sector will be driven by rising GDP, increasing trends of urbanization and growth of traditional as well as emerging sectors like IT, BFSI, education, tourism and healthcare.

  • The Indian Real Estate sector has seen significant growth in recent past and is expected to reach a size of US$ 180 Bn by 2020.
  • Growth in Indian real estate sector will be driven by rising GDP, increasing trends of urbanization and growth of traditional as well as emerging sectors like IT, BFSI, education, tourism and healthcare.
  • Over a short span of time, the industry has evolved from a highly fragmented and unorganized market into a semi-organized market, with a large number of listed companies.
  • BlackSoil Realty Investment Advisors proposes to setup its first Realty Fund that would provide investors an opportunity to invest in the Indian real estate sector with focus on cities like Mumbai and Ahmedabad, but also open to evaluate opportunities in other cities like Bangalore, Chennai and Pune; alongside two of India’s respected corporate house who are acting as sponsor of the fund
    • 1) Gala Family, promoter of Navneet Publications
    • 2) Shashi Kiran Shetty, promoter of Avvashya Group
  • Target fund Size to INR 200 - INR 250 crores

Fund Size

INR 200 crores within an upsize option of upto INR 50 crores

Structure

SEBI Registered Category II Alternate Investment Fund

Tenure

6 years from final closing with 2 times 1 year extensions

Investment Manager to the Fund

BlackSoil Realty Investment Advisors LLP

Trustee

IL&FS Trust Company Limited

Custodian & Accountant

IL&FS Securities Services Limited

Auditor

Khimji Kunverji & Co

Investment Period

Commencing from the date of Initial Closing and terminating upon expiry of a period of 4 years from the date of Final Closing

Legal counsel

Khaitan & Co., Nishith Desai Associates

Sponsor

Mr. Gnanesh Dungarshi Gala and Mr. Shashi Kiran Shetty

Refer to Private Placement Memorandum for detailed terms & conditions


Following are the few benefits of investing in BlackSoil Real Estate Fund

Management

The sponsors have strong pedigree and understanding in realty business. Their strong network in industry will help the fund in identifying and executing good projects

Diversification

Provide necessary diversification with in real estate market across segments, geography and developers

Preferred Mode of Financing

Majority of the real estate projects pre 2005 were financed through banks and private lending. However in 2012-13 Private Equity, NBFC Lending and Private Lending are expected to be preferred modes

Tax Efficiency

More tax efficient than direct investment in real estate

Liquidity

More liquidity in comparison to investment in an individual property, given the illiquid nature of the asset and complex & time consuming process of buying and selling

High Returns

Provide high returns in comparison to other type of exposure to real estate market like investing in listed real estate companies

Investment Philosophy

Investment objective

Investments will be made by the Fund keeping in mind the below mentioned objectives

Investment Objectives

To focus on long term capital appreciation for the intvestors & maximize returns over the term of the Fund

To opportunistically invest in "well positioned" residential, commerial, mixed use real estate assets in high growth urban centers

To invest as per well defined investment criteria

Be tax efficient to the investors

Broad Investment Strategy

Fund plans to invest in residential projects, co-invest in investee entities with developers, diversify risk and formulate clear exit strategies

To Invest in – 1) Residential projects based in high growth urban cities*, 2) mixed use development assets 3) Trading in “transfer of development rights”

Invest in projects with real estate developers and/or partner with real estate developers

Adequate risk diversification with Prudential investment caps. Not to invest more than 25% of aggregate Capital Commitment in any single Investee Entity

Unutilized capital contributions be invested in temporary /short term investments

Formulate clear exit strategies and to react quickly on the potential real estate opportunities

Fund’s Current investment Focus

Based on the current market situation following is the investment focus of the Fund

Geographic Area

The fund plans to invest in residential real estate projects in Mumbai/Thane/ Ahmadabad

Stage

The projects can be greenfield / under construction or where significant progress has been made

Project Type

a) Development of land parcel b) Redevelopment c) Slum Rehabilitation d) Land acquisition

Preferred Deal Size

Min INR 15 Cr, Max INR 50 Cr

Transaction Type

1) Equity/Quasi-Equity/Quasi Debt 2) Significant minority control on various strategic aspects of the project
3) Project to be eligible of securing debt from banks and financial institutions 4) Staggered cash flows

Partnership Type

Fund will do 1) JV with known developer who is known to sponsors 2) JV with land owners (if known to sponsor/developer),
3) Projects promoted by sponsors

Return Objectives

The fund plans to generate pre-tax IRR >25%

Investment Process

The Process will begin with originating a lead followed by evaluating / negotiating a proposal in detail, taking Investment Committee’s approval, doing due diligence, making investment, regularly monitoring it and finally exiting from it

  • Lead Origination
  • Analysis
  • Proposal to Investment Committee

Team responsible: The Project Team comprises of Fund Manager, Legal, Architect, Associates & Analysts
Responsibilities: Identifying the investment opportunities as per the defined investment strategy First Level Analysis such as Financial Valuation & Feasibility Presenting a First Level Analysis to the Investment Committee Conducting initial Due Diligence

  • Investment Committee Approval

Signing of term-sheet by Investment Committee . Investment Committee comprises of management of sponsor & representatives of some key investors

  • Due Diligence

Team responsible: Project Team, Legal Team and the other appointed third party consultants.

  • Investment Committee Decision
  • Legal Documentation Process
  • Deal Closure

Team responsible: Investment Committee & Management Team along with external advisors
Responsibilities: Due diligence report review Authorized to take an Investment Decision Structuring the deal Negotiating the deal Liaising with the Investors

  • Monitoring & Managing the Investment

Critical Role of the Management Team is to ensure the timely development of assets within the budgeted cost

  • Exit in a Defined Time Frame

Activity Flow Chart of Asset Management Team

The below mentioned activities will be followed by the asset management team

Acquisition Stage
  • Follow up with the appointed government agents on the status and progress of various approval
  • Preparation of asset performance tracking methodology for evaluation of asset
  • Following up with appointed contractors & job work agencies on status of procuring various resources
Development Stage
  • Ensuring projects targeted schedules/completion dates & required quality standard are adhered to
  • Aiding developer in taking the strategic and financial decision & resolve regulatory issues
  • Oversee the phase by phase monitoring of project development by an architect team
  • Monitoring the flow of information during the development process
  • Make operational changes to improve “Asset Performance”
Holding Stage
  • Assisting the developer in leasing out the office and retail space and helping him on tenants agreement
  • Supervise and direct the facilities management company to better maintenance of the property
  • Monitoring the cash flow and carrying out the cash flow & lease analysis periodically to measure the performance(Applicable only in case of commercial real estate assets)
Disposition Stage
  • Aiding developer in preparing the post development sales strategy for residential apartments ,to sell / lease retail and mixed use developments; and to sell the commercial assets at the time of fund closure
  • Evaluate the “Exit Strategy” as ideated in the business plan and ensuring the adherence
  • Helping the developer on resolving the legal issues faced by end users /consumers

PORTFOLIO

Investments

BlackSoil Realty Fund invests INR 35 crs in two residential projects in Bandra

Download

BlackSoil Realty Fund has invested INR 3 crores in four residential projects of Hyderabad-based developer

Download

BlackSoil Realty to invest INR 26 crs in a luxurious residential project at Tardeo

Download

Exited Investments

BlackSoil Realty Fund Completes Its Maiden Investment in Sheth Developers

Download

BlackSoil Realty Fund successfully exits its investment in Bengaluru based developer, Krishna Enterprises

Download

BlackSoil Realty set to invest INR 25 crs in Ahuja Constructions’ residential project, O2 at Sion (E)

Download

INVESTMENT COMMITTEE

The brains behind the 'epicness'

BlackSoil endeavors to invest in early stage growth opportunities in the Real Estate. It has capability to manage such investments on the strength of an experienced and well versed management team.

BlackSoil’s Team comprises accomplished professionals and industry leaders with impeccable credentials and wealth of experience across sectors including real estate and financial services. They play a key role in ensuring adherence to the stated investment strategy and approach in consistent manner to achieve optimum results.

Team utilizes an extremely proactive approach in deal sourcing. Adopting a top down approach to an industry allows the team to understand the value chain of each industry in-depth and identify the key players and the core members are involved in deal sourcing and spotting potential opportunities for real estate fund investments.

Investment Committee comprises of successful corporate leaders from diverse background.

Mr. Gnanesh (Sunil) Gala is President (Finance) of Navneet Publications Ltd. and associated with the group for the last 28 years. Mr. Gala, after completing B.Com from Sydenham College of Commmerce and Economics, Mumbai University, joined the family business and shouldered the responsibility of managing the key areas of finance and taxation of the group.

As President - Finance, he has taken several initiatives to accelerate the company's topline and bottom-line growth. It was his vision that Navneet should be a household name amongst parents, children, students and teachers across the country. He has maintained professional rapport with key people in Banks, FIs, stock broking community and other industrialists.

He is an integral part of the Gala family’s Real Estate business – Gala Infra for the last 10 years. His role in Gala Infra includes managing the financial planning process, determining the financial needs and cash management, ensuring the reliability of financial reporting and planning for the business, guiding sales department and advising on key strategic decisions.

Mr. Shashi Kiran Shetty is the Chairman & Managing Director of Avvashya group of companies which are active in logistics and real estate sector. Mr. Shetty has completed his B.Com from Shri Venkatramana Swamy College, Karnataka.

In 1993, he founded Allcargo Logistics, which has built capabilities in the NVOCC and multimodal transport business. With acquisition of ECU Line- a Belgium based company in 2005, the company evolved into a global player with over 142 offices in over 62 countries. Today the company operates in 5 continents, and is known as the largest LCL consolidator globally.

He is also the Chairman and MD of SKS Netgate Pvt. Ltd., the promoters of Planet SKS, a mega eco-housing project worth INR 150 crore, which boasts of becoming the tallest skyscraper in Mangalore and one of tallest residential building in South India.

He has been conferred with the E&Y Entrepreneur of the Year Award in services category in the year 2010 and has also won the ‘Face of the year’ award at the 4th Express Logistics and Supply Chain awards (ELSC) organized by the Economic Times & Future Group.

Mr. Virendra Gala is the promoter of Mahavir Agency, which is engaged in the business of real estate advisory services. He has over 25 years of consulting experience in real estate industry in Mumbai and Thane region. His expertise lies in all aspects of real estate sector starting from the acquisition of land till the possession of fully developed project to end users. He specializes in enabling sale and acquisition of large parcels of industrial lands, strategizing marketing of large real estate projects, bulk buying with the help of corporate houses and HNIs, sole selling of projects through his own retail network, helping developers in deal structuring and raising finances as well as dealing in real estate regulatory and other related issues.

He is associated with reputed clients like Sheth Developers, Naman, Ariisto, Ruby Mills Group, Fortune, Dhanlaxmi, Prime, Cello Sonal, Satara, etc. He has been instrumental in selling various industrial lands such as Zandu Pharma at Dadar, Borosil Glass at Andheri, Voltas at Thane, Standard Mills at Prabhadevi, Bihor Industries at Kandivili, Bombay Metal at Chembur, Eastern Ceramics at Goregaon etc.

He has successfully completed transactions of ~5 million sq ft of industrial & land parcels for Sheth Developers in Mumbai & Thane region and has also accomplished transactions size of ~2 Million sq ft with other developers across Western Mumbai. As a sole selling agent he has sold ~5 lacs Sq.ft of transactions (Residential & Commercial) and has also underwritten projects aggregating to ~2 Million sq ft.

Mohinder has over 25 years of experience in M&A, strategic advisory, capital markets, portfolio company integration as well as post-acquisition performance management in India, Asia and Europe

  • He has advised corporates in multiple sectors including logistics, auto components, manufacturing, realty, banking, education and IT. Mohinder has significant hands-on operational experience managing corporate entities as well as in conducting due diligence, structuring and negotiating transactions. Mohinder has also advised private equity firms in India on improving the performance of their portfolio companies.
  • Mohinder led the Allcargo Global Logistics team in negotiating a $75m investment from Blackstone(India). Prior to this, he led the €30m acquisition of EcuHoldNV, a Belgian logistics company, by Allcargo. Post acquisition, Mohinder took up the position of Group CFO and was based in Antwerp, Belgium for three years, starting in 2005. Mohinder was later named Vice Chairman of the EcuLine and was instrumental in their structuring and successful integration with Allcargo.
  • In 2005, Mohinder acted as the sole advisor to Amforge Industries on a complex $60m de-merger and sale of assets to Mahindra Group
  • Mohinder has also advised Indian corporates on various capital raising transactions including Allcargo's $30m IPO, Bank of Punjab’s $20m IPO and Garware Polyster's $10m rights issue
  • Mohinder is a Chartered Accountant from the Institute of Chartered Accountants of India and holds a Bachelor’s Degree from the University of Punjab

Mr. Bansal is also the Director/Partner in following Companies/LLP:

  • AllCargo Logistics Limited
  • Navneet Education Limited
  • BlackSoil Capital Pvt. Ltd.
  • Concorde Motors (India) Limited
  • K12 Techno Services Private Limited
  • Girik Wealth Advisors Private Limited

Tushar Jani is the founder Chairman of Blue Dart Express Ltd., the premier International and Domestic Courier Company, which was taken over by DHL Express (Singapore) Pte.Ltd in March, 2005, presently he is the Chairman of Blue Dart Aviation Ltd. the first private air cargo carrier in India having its own fleet of seven aircrafts.

Kaiwan Kalyaniwalla is a Solicitor and Advocate of the Bombay High Court and a Partner in the law firm of Maneksha & Sethna in Mumbai. He has been in practice for over 22 years. He is enrolled as a Solicitor of the Supreme Court of England and Wales.

NEWS

BlackSoil Realty Fund In The News
We're proud to have all of these accomplishments.

CONTACT US

We would like to hear from you.

Name:

Last Name:

Email Id:

Contact Number:

Your Valuable Feedback: