Piramal Fund sanctions Rs 1,200cr for Mumbai realty project

Piramal Fund Management (PFM) today said it has sanctioned Rs 1,200 crore in financing for a high-end residential project being developed by Omkar Realtors in the metropolis.
The Fund, a unit of Piramal Enterprises Ltd, claimed it was one of the biggest realty project finance transactions in recent times.
Of the total commitment, Rs 400 crore will be used to refinance existing lenders, while the balance Rs 800 crore has been secured against a 20:80 scheme and is to be released in a staggered manner over the next two years as the project progresses, PFM said in a statement here.

'Omkar 1973' is the flagship property of the city- based realtor involving three high rise towers coming up on a nine-acre land parcel in Worli, Central Mumbai.
Over 4 lakh sq ft, or 60 per cent of the under- construction project, has already been booked, the statement said, adding the builder is targeting for a delivery in 2017.
"The construction finance component of our transaction will be utilised towards funding interim construction costs and is further secured by both the 80 per cent receivables from the area sold as well as a substantial portion of additional area retained as security on a exclusive basis," the Fund said, explaining the deal's structuring.

PFM Managing Director Khushru Jijina called it a "novel structure" which involves a combination of senior debt and secured project funding.
The Ajay Piramal-led Piramal Enterprises also has interests in private equity investments in real estate and developing land banks, among other areas.