Tuesday, December 4, 2007

What Real Estate Funds will Bring to The Sector?

After HDFC and ICICI’s billion dollar funds, a number of international players are making beeline to exploit opportunities underlying in the Indian real estate markets. Just look at the pointers below:

•UBS Global Real Estate, the real estate arm of global financial services powerhouse UBS Global Asset Management, plans to launch a $1-billion India specific real estate fund by the end of this year.

•Over $4 billion belonging to various global realty funds is ready to enter the Indian real estate sector on the back of $1 billion which has already come in, according to Bobby Parikh, managing partner, BMR and Associates.

•Morgan Stanley and Goldman Sachs Group Inc. raised $12 billion for global real estate funds, tapping a surge in investor demand for high-return assets.

•The UK-headquartered Knight Frank Group plans to launch a $250 million India-focused real estate fund. This could be the first real estate fund by a property consultancy in India. It will be an offshore fund, and will raise a minimum of $0.5 million or above from high networth individuals.

But, how much these funds will contribute to the development of industry, and the country is the biggest question..!

1 comment:

Realty Rider said...

The addition of new real estate investment products and property funds that developers are lining up are expected to exacerbate the talent crunch in real estate. Though regulatory clarifications are still awaited, fund houses are already on the hunt for key personnel, who have the caliber to look after investments in real estate. People who have worked with property consultants and investment banking firms are being mostly preferred over the other lot. With talent in short supply, speed is of essence. Poaching from competitors is rampant. At any given point in time, good people have 2 to 3 offers in hand. There is a premium on readymade talent. Not surprisingly, salaries are flying. On an average a professional gets 25-35% increment annually. Were they to change jobs, the increment rises to 40%-50%. For companies, the cost implications multiply if there is a delay in projects. That makes these companies more than willing to meet the rising expectations of candidates. Educational institutes have been quick on the uptake, launching specialized courses. According to a Ma Foi Employment Survey, real estate is likely to add about 47,000 professionals in the organized segment this year. How will the demand be catered to? Overseas talent is one answer. Salaries in India have become comparable to those in the US, and the subprime-triggered slump there is helping draw talent. Another approach could be hiring advisory services instead of hiring and developing in house talent. What’s your take on this???For more view- realtydigest.blogspot.com