Godrej Fund Management raises $200 million from APG for office segment

Godrej Fund Management (GFM), the real estate private equity arm of the Godrej Group, on Monday said it raised $200 million from Netherlands-based APG Asset Management for its $500 million office property fund. This is the first closure for the fund.

The Godrej Group has put in $50 million into the fund called Godrej Build to Core (GBTC) II. The fund manager plans to do the second and final close by the end of the year. Asked whether GFM will raise funds from Allianz, its investor in the previous fund, Karan Bolaria, MD & CEO, GFM, said, “All options are open and we are in talks with multiple investors for the second and final close.”

This is the second fundraising announcement by a real estate fund manager in recent weeks. Last week, Motilal Oswal said it is raising Rs 800 crore property fund for construction financing. GFM will have the ability to develop class-A office assets that will be valued over $1.5 billion (Rs 11,000 crore) on completion.  The total value of office assets, including those from previous funds, will take the portfolio value on completion to over $3 billion (Rs 22,000 crore), the fund manager said in a release on Monday.

GFM has fully invested the previously raised capital under GBTC I and Godrej Office Fund I. The platform currently has a strong investment pipeline and aims to deploy the newly raised capital within 12 months, it said. This is the third India-focused office venture and fifth overall, sponsored by GFM.

Bolaria added, “Our group has strong conviction in India’s premium office sector and we believe the current dislocation in markets provides attractive capital deployment opportunities. The addition of this platform brings significant scale to our overall strategy and will open up strategic avenues for value maximisation.” 

Graeme Torre, MD, APG Asset Management Asia, said, “The build-to-core strategy for Indian offices aligns very well with our broader investment aspirations for our pension fund clients and our desire to invest alongside partners who offer best-in-class execution capabilities.”