India's HDFC to secure $500 mln for its special situations fund

The private equity arm of Indian financial holding company Housing Development Finance Corp. (HDFC), HDFC Property Fund, is securing $500 million for its new fund.

The new fund, special situations fund, expected to secure the new funds from prominent financial institutions, will invest in residential projects, both under development and buyout projects with ready, unsold inventory at a discount.

The special situations fund, anticipated to be raised this year, will offer long-term, semi-equity to projects in the top seven cities, and to smaller property markets such as Bhopal and Indore.

The fund will focus on mid-market and affordable housing projects, where homes are priced at $64,464 to $85,953. Deal sizes will vary from $10 million to $11 million in smaller cities and $36 million to $43 million in the metros.