LICHFL Real Estate Overseas Fund – I (LREOF)

LREOF launched by the LIC group’s Fund House.

LICHFL Real Estate Overseas Fund established as a Trust under the Indian Trusts Act, 1882. The Trust is organised as an irrevocable contributory determinate trust under the Indian Trusts Act, 1882. LICHFL Asset Management Company Limited is registered with the International Financial Services Centres Authority as a Registered Fund Management Entity (Non-Retail) under the IFSCA (Fund Management) Regulations, 2022 .The Fund is a category III close-ended fund and is set up as Restricted Scheme (Non-Retail) under the FM Regulations. LREOF is an integrated sustainable impact housing Fund.

Corpus

Proposed corpus is USD 350 Million including green shoe option USD 175 Million.

Tenure

Investment tenure in any one portfolio company to be between 3 to 6 years. Term of LREOF is 10 years from initial close.

Target Investors

LICHFL Real Estate Overseas Fund established as a Trust under the Indian Trusts Act, 1882. The Trust is organised as an irrevocable contributory determinate trust under the Indian Trusts Act, 1882. LICHFL Asset Management Company Limited is registered with the International Financial Services Centres Authority as a Registered Fund Management Entity (Non-Retail) under the IFSCA (Fund Management) Regulations, 2022 .The Fund is a category III close-ended fund and is set up as Restricted Scheme (Non-Retail) under the FM Regulations. LREOF is an integrated sustainable impact housing Fund.

Returns

Hurdle rate 8% for USD investors.

Targeted IRR at portfolio level is ~20%+ in INR plus upside (based on business performance), secured by charge on assets, promoter share pledge, guarantees, cash flow hypothecation.

Forums

Charge would be registered in 3 forums:
1) Sub-registrar office regarding mortgage of land,
2) Charge in ROC/ Ministry of Corporate Affairs, and
3) RERA website.

Exits

Exits targeted to be achieved by self- liquidation and not dependent on secondary sale or IPO listing.

Strategy

Fund would follow a proven investment strategy for capital protection backed by hard assets, with distributable cash cover > 2.5X and valuation multiple > 1.5X of invested amount.

Investment in project specific vehicles (private limited company) to insulate from collateral damage.

Management

Skilled management team with average experience of over 10+ years and combined experience of over 175 years.

Robust risk management by 3 level due diligence process, active project monitoring, rights on reserved matters, use of ERP, periodic site visits, choice in appointment of technical & internal auditors, control of sales & bank accounts.

Access to promoter’s vast infrastructure including 300+ home credit offices, and proprietary deals due to strong relations with the Indian developer’s community.

Complaint Handling and Grievance Redressal

Complaint Handling and Grievance Redressal details are in the document below.

Complaint Handling and Grievance Redressal - LREOF