Certus Capital to roll out its first Rs 500-crore real estate AIF this fiscal

The firm, founded by the former KKR director, also plans to invest over Rs 1000 crore through secured credit in the real estate sector by the end of FY25.

Certus Capital, an institutional real estate investment platform, plans to launch its first credit-focused alternative investment fund (AIF) with a corpus exceeding Rs 500 crore in FY25, its founder Ashish Khandelia told Moneycontrol.

"We had a SEBI licence for Category-II AIF during the Covid period but decided not to take up the opportunity. For this platform, we will look at special situation credits to acquire real estate projects," Khandelia, a former KKR director, added. Certus Capital expects a gross yield of 20 percent and hopes to close the fund platform within 12 months.

The firm plans to invest over Rs 1,000 crore through secured credit in the real estate sector by the end of FY25. The company said it has already closed about Rs 450 crore of the pipeline in three different transactions and hopes to commit the rest by the end of the current fiscal.

The deals

Among the last transactions, the company invested Rs 130 crore in two prime commercial real estate projects in Pune through its secured bonds platform in March 2024. These projects are being developed by Mittal Brothers, a Pune-based developer with a track record of 26 projects encompassing over 65 lakh square feet over the past 25 years.

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In another deal, the company invested Rs 125 crore in a Casagrande Project in Chennai. The company said it has also invested over Rs 100-150 crore in projects in Mumbai that are in advanced stages of transaction.

"We want to increase our commitment to about Rs 1,500-2,000 crore within the next 12-18 months. We are majorly looking at post-RERA projects with a healthy project timeline of 3-3.5 years for the additional transactions," Khandelia said.

Southern push

The company added that the southern cities will account for at least 70-75 percent of the transactions in future. "We might also look at some transactions in Hyderabad for the first time. Additionally, we may look at Tier II cities also," he added.

Since its inception in 2018, Certus Capital has evaluated over Rs 40,000 crore of real estate credit exposure forming part of NBFCs and housing finance companies.

It has also advised foreign institutional investors on nearly Rs 10,000 crore of closed investments/platform commitments in real estate credit and warehousing space. Foreign investors participated in over $2 billion of real estate credit opportunities, offering around 18 percent secured returns, over the last three years.