The 30 to 40 per cent decline in property prices (from peak levels), coupled with firming interest rates have resulted in private equity (PE) funds eyeing investment opportunities in rental space.
A few fund houses have already begun seeking investment commitments from investors, indicating 16 per cent to 22 per cent as annualised portfolio returns.
PE funds investing in real estate rental space follow a simple investment strategy.
These funds are suited for investors who are risk-averse and prefer returns similar to those from fixed income schemes. According to PE industry officials, Milestone Capital Advisors, Xander Real Estate Partners, Indiareit Fund Advisors and an investment arm of Delhi-based real estate company DLF are planning to launch rental yield funds in India, reported Economic Times.
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