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PropShare Real Estate Fund I

IME AIF Rating: 5-star | Open for subscription: Yes | AIF Category: Real Estate PE
  • Strategy: Clear commercial property rental yielding-focused strategy. The narrow focus reduces the risk for investors, unlike other RE strategies that have a presence in last-mile funding (which lack cash flows and have gestation periods before realization). The tenant credibility and lock-in bring certainty of cash flow to the investors. Fee also at the lower-end makes a compelling case for PropShare AIF.
  • Investment Team: Highly experienced team with previous experience at highly credible real estate firms.
  • AMC: PropShare was amongst the first India RE-focused advisor that made commercial real estate affordable for investors. With $3bn transaction value and 33 mn sqft of office, retail, and warehousing assets in India since the inception of the firm, the firm comes with high credibility in identifying properties.
  • Leverage: leverage at 2 property levels (out of minimum 4) adds to the investors IRR
  • Work from Home Risk: WFH continues to be key structural risk although PropShare and other major ‘A’ grade office backers have not seen a major dip in collections during peak covid periods too.
  • Formal employment generation: commercial properties esp offices are highly dependent on job creation, which is majorly driven by IT and Banking in India. Any recessionary pressures of industry-level adversaries could impact property demand as a result of property yield and capital appreciation. Although both IT and banking seem to be doing well at this point.
  • Investors looking to diversify beyond equity, and debt or looking at alternatives to high-risk debt instruments would find this offering very attractive, keeping in mind the key risks.

STRATEGY

PropShare Real Estate Fund I is a strategy that aims to benefit from the commercial property boom in India with a focus on rental yield and capital appreciation at the exit.

  • Annual Rental Yield (pre-tax): 7-9% — distribution on monthly or quarterly basis
  • Target IRR: 17-20%
  • Investment Horizon for a property: 3-5 years
  • Fund Tenure: 5+1+1 years
  • Rental Terms: Focus on MNC tenants | at least 75% pre-leased
  • Diversification: at least 4 properties under the AIF
  • Commitment Period: 18 months

INDICATIVE CASH FLOW

LIFETIME CASHFLOW

INDICATIVE DISTRIBUTION

AMC

PropShare was founded as a tech platform that provides its users access to institutional-grade commercial real estate with property management and liquidity through resale. The AMC has recently launched their AIF structure. PropShare's team comes with deep experience in institutional real estate investing and provides institutional-quality analysis, asset management and liquidity at much lower investment thresholds.

AMC Rating

4 of 5 stars

AMC Pedigree

0 of 5 stars

AMC Size

0 of 5 stars

Team Pedigree

0 of 5 stars

Inv Philosophy

0 of 5 stars

Performance

0 of 5 stars