The platform for fractional real estate ownership, hBits, intends to collect more than Rs500 crore through an Alternative Investment Fund (AIF) in order to invest in commercial real estate, including projects for offices, data centres, and warehouses.
This will be the first time a fractional ownership platform in India has raised such a fund. In order to raise money, the company will use both domestic and foreign capital, depending on how the markets react to its initial market activities.
In the upcoming 12 months, the company hopes to have Rs1,000 crore worth of assets under management, thanks to the proposed new fund and additional expansion activity. Since it began operations in 2019, the business has assets under management worth Rs150 crore
According to Shiv Parekh, founder of hBits, “the planned fund will invest in grade A properties recognized by hBits and those will also be available to retail investors seeking exposure to such pre-leased high-yield assets.” “In India, fractional ownership has been developing rapidly, and investors are drawn to the chances to invest in Grade A homes and generate a steady income.”
According to him, multinational corporations, who are aware of the prospects presented by commercial real estate, make up 70% of the platform’s customer base. Through this platform, the business serves more than 30,000 investors, and by the end of the year, he hopes to treble that number.
hBits has appointed Sameer Bhandari, a former managing director of Nomura, as its Chief Financial Officer in accordance with its objective to dominate the prop-tech sector. Bhandari will be in charge of hBits’ expansion into other areas both inside and outside of India. She has previously held senior leadership positions with UBS as Executive Director and JP Morgan as Managing Director.
The top 50 Indian blue-chip businesses’ senior executives and management have already invested in the company’s assets.
The legal team at hBits has already begun putting together the necessary paperwork for the fundraising, and it plans to submit an application for clearance to the Securities & Exchange Board of India (SEBI), which oversees the capital market.
In the upcoming 12 months, the company intends to expand to the top six real estate markets in the nation. Mumbai, Pune, and Bangalore assets worth over Rs300 crore are currently the subject of acquisition talks. It will invest between Rs50 crore and Rs100 crore in each of these assets.
Due to fractional ownership, investors can access income-producing real estate assets without making the customary sizable financial commitment. It describes a scenario in which several investors pool their money to buy a property and then share passive ownership of a high-value asset as a result of their investments.