AIF

Alternative Investment Fund (AIF)

Real Estate Fund I


SEBI Registered Category II Fund

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Our CAT II AIF is designed to cater to Grade A commercial real estate assets pan India. This includes a wide range of commercial projects such as offices, retail spaces, data centers, warehouses and hospitals across under-construction, pre-leased and other completed/operating assets.

By investing in commercial assets at various stages of development, our AIF offers investors a diversified portfolio that capitalizes on the flourishing Indian real estate sector.
Under Fund I, we estimate investment allocation of about 50% - 60% in preleased assets and balance 40% - 50% in under construction assets, targeting Internal Rate of Return (IRR) ranging from 19% to 21%.

Aif Funds

Market size of CAT II AIF

INR 7.82 lakh crore

*Source: SEBIAs of 30th September 2023


Alternative Investment Fund

About hBits Real Estate Fund I

SEBI registered CAT II AIF of INR 500 Cr targets equity investments on income generating and under-construction Grade A commercial real estate assets in top tier Indian cities.

About the Fund

Fund Size

INR 500 Cr

(Inclusive of INR 250 Cr

greenshoe option)

Tenure

7 Years

(With two one-year

extensions)

Performance Fee

15%

(Over 10%

huddle rate)

AIF Investment

IRR Expectations

Alternative Investment Funds AIF Best

Why Invest now?

  • India’s commercial real estate market is poised to reach USD 1 trillion by 2030, providing lucrative investment opportunity.
  • As interest rates have peaked, it will be beneficial for investors to lock-in long term deals at current rates.

Investment Thesis

AIF Alternative Investment Funds

100% Deal Sourcing

Investment opportunities of over INR 2,500 Cr across the top six cities (MMR, Pune, Bangalore, Hyderabad, Chennai and NCR) are sourced month on month by the buy-side team

50% Evaluation

Yield expected capital appreciation, location, micro market analysis, data insights ( comparables, financial projections, developer, occupier profiles and lease terms).

20% Shortlist

After evaluating basis the above given criteria, keeping in mind the investors’ goals and desired IRR, the investment opportunities are shortlisted

<1% Transaction

After carrying out legal and title, asset level, technical, financial and tax diligence (in the case of SPV acquisition), the asset is acquired.

Invest In AIF

Why hBits?

AIF Funds In India

50+ Years of combined management experience in Commercial Real Estate

AIF India

200+ Years of experience and personal ownership in end-to-end commercial real estate development and management

Best AIF Funds In India

Backed by marquee names in the Commercial Real Estate space

Why Choose hBits For AIF Investment

Pipeline of over INR 25,000 crore of Grade A assets (originated since Nov 2022) with an average of INR 2,500 crore per month across office, warehouse, industrial and educational institutions


Investments Portfolio (Fractional Ownership Platform)

Japanese Auto Giant
Live

Japanese Auto Giant Opportunity - CBD, Bengaluru

Langford Road , Bengaluru
Tenant
Japanese Auto Giant
Funded
15%
Asset Value
54.73 Crore
Entry Yield
9%
Expected IRR
15.6%
Pre Leased Commercial Property

Tech MNC at IT Hub

Goregaon (East) , Mumbai
Tenant
Gupshup Technology India Private Limited
Resale Available
0
Completely Funded
100%
Asset Value
27.31 Crore
Gross Entry Yield
9%
Expected IRR
15.49%

FAQs on AIF

Below are some benefits of investing in AIFs:

Diversification: Investors can reduce risk and maintain returns by diversifying their portfolios, which is especially important for High-Net-Worth Individuals (HNIs) with larger investments. AIF can serve as a hedge during market volatility, thereby enabling portfolio diversification.

High returns: AIFs can deliver higher returns to investors compared to other options. The funds are managed by a professional fund manager who can prepare flexible strategies for maximizing returns.

Low volatility: Real Estate AIFs are not linked with the stock market. Therefore, the volatility is less in these funds.

Investors DO NOT NEED TO PAY ALL THE COMMITTED AMOUNT UP FRONT. The first drawdown will be up to 25% of the committed capital. Subsequent drawdowns will always be on a pro-rata basis of their uncalled commitments, and investors will have to pay within 15 calendar days of the drawdown notice.

Type of Risk Meaning Pre-leased Under Construction
Title/ Legal Risk Land Title Clarity No No
Regulatory/ Approvals Risk Any approvals from regulatory bodies (like BMC etc.) No (We will enter transactions post land aggregation and commencement of construction approvals)
Execution Risk Construction completion No Yes
Market Risk Finding tenants for leasing the property No Yes
Counterparty Performance Tenant Financial Health and Flight Risk of the Tenant Yes Yes

The team has a combined management experience in commercial real estate having worked across private equity, IPC’s, financial institution, and developers. This includes 200+ years of personal ownership in end-to-end commercial real estate development and management. The team has acquired assets, raised capital and given successful exits to multiple investors.

We are going to be investing in the top 6 - 7 cities in India. For office spaces - It would be Mumbai, Bangalore, Hyderabad, NCR. For Warehousing - We believe the regions around the cities mentioned above offer great warehousing spaces as they are high-consumption centres. For Industrials - we would be looking at Pune and Chennai with great attention.

REITs are listed on the exchange and the underlying asset value is the same. However, the quantum of investment varies. REITs have a much larger corpus and hence can make larger acquisitions where as we are looking to target 75-95 crores per transaction. The tax implications are also very different in the hands of the investors. REITs are listed on the stock market but we are a fund. AIF on the other hand is a blind pool, where the units are illiquid, quantum of investment is much higher.

This is governed by SEBI rules and laws. There will be compliance and frequent reporting that needs to be done to SEBI (quarterly/semi-annual/annual). Downstream investments will be as per the Companies Act.

Yes, investors will be provided a dashboard where they can track their investments.
Additionally, each investor will get a quarterly report as well as per SEBI requirements which would give a full flavour on how the investments are faring.

Class of Units Quantum of Investment Management Fee
Class A INR 10 Cr + 1.50%
Class B INR 5 - 10 Cr 1.75%
Class C INR 1 - 5 Cr 2.00%

The minimum ticket size is INR 1 Cr. There is no maximum ticket size.

Investors who have the patience to invest in real estate and want to take part of the growing and changing landscape of the commercial real estate sector, hBits offers these HNI’s, Family Offices, Corporates and other UHNI’s opportunity to participate.

Yes, of course. All NRIs, can invest in AIFs on non-repatriation basis. NRIs must ensure that the funds are transferred from NRE or NRO account in compliance with the foreign exchange regulations.