HDFC Capital raises $1.8 billion for affordable housing projects

NEW DELHI: India's HDFC Capital, a private equity investment manager, said on Sunday it has raised $1.8 billion from investors, led by a unit of Abu Dhabi Investment Authority ADIA, for its third low-cost housing fund.

The upfront amount of US $1.2 billion is being invested with an additional US $600 million commitment towards the reinvestment of the principal amount, the company said in a statement.

HDFC Capital Affordable Real Estate Fund 3 will provide long-term financing to develop about 280 million square feet of affordable and middle-income housing projects across India. It will invest in low-cost housing-related technology companies, it said.

A unit of the Housing Development and Finance Corporation HDFC HDFC Capital has a long-term plan to fund the development of one million affordable homes in India, in line with Prime Minister Narendra Modi's 'Housing for All' campaign.

According to Deepak Parekh, chairman of HDFC, the housing will play an even more important role in India as a catalyst for growth.

HDFC Capital has a US $3 billion funding platform, making it one of the biggest in the world for affordable housing, together with its first two funds, in which ADIA has also invested.

According to Khadem AlRemeithi, executive director, real estate and infrastructure department, ADIA, this builds on the success of previous funds and addresses the significant demand for affordable housing in India.