JM Financial to Invest in Real Estate

April 12, 2007	(Be the first to rate this story!)  Loading ...
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JM Financial is all set to foray into real estate market.  The group’s $400 million real estate fund, Infinite Investment Management, has invested a whopping $60 million in five projects in India. The fund is also looking at picking up equity stakes in mid sized real estate projects. However, the company is finding it difficult to raise capital through debt and equity markets.

JM Financial has parted the ways with Morgan Stanley thereby ending its seven years relationship with the firm. It is now planning to take up the development in new potential areas including real estate and mutual funds.

The Mumbai based investment bank, now envisages developing residential as well as commercial properties, says Karthik R Sarma, managing director of JM Financial, and has entered into a co-development agreement with a Mumbai-based company to build a commercial-cum-residential township in Powai. It has acquired land in eight cities to construct service apartments and is building an IT park in Chennai.

Tier-II cities lack to strike proper supply-demand equilibrium. Real estate development in India is believed to have marked a growth of 30% in a year. Almost 80% of the real estate activities in India, 80% of them were focused on residential segment, Sharma adds.

Not just JM Financial but other real estate companies are also finding it difficult to raise the funds. The recent directives by RBI to banks to cut on real estate exposure, are expected to lead to private equity investment in the sector, explains Sharma.

News Published Under:   Real Estate India, Foreign Direct Investment in India |

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