Singapore-based CapitaLand Investment Ltd (CLI) is planning to more than double its funds under management (FUM) in India by 2028 from the current base of S$7.4 billion. Besides scaling up investments in business parks, data centres, and logistics, the fund manager plans to make forays into private credit for real estate and investments into renewable energy projects.
Andrew Lim, group chief operating officer, CapitaLand Investment—a real estate asset fund manager—said the proportion that India comprised of the overall business was about 3.5 per cent in 2019, and today the proportion is just north of seven per cent of S$100 billion FUM. CLI plans to double the funds under management by 2028 (S$200 billion), which implies that the growth trajectory for India should outpace the trajectory for any other market, he said in a presentation to the media on India business plans.
At present, business parks have a 90 per cent share in FUM in India, and the balance 10 per cent is industrial. The share of different lines would change in the growing FUM. Business parks would have a 60-65 per cent share by 2028, said Sanjeev Dasgupta, chief executive officer, CLI India.
The business growth in the country will be through listed CapitaLand India Trust (CLINT) and private funds. The fund manager has set up four private funds across logistics and business parks. There are opportunities for data centre funds in India, riding on the country’s fast-growing digital economy, he added.
On new business lines, Dasgupta said CLI will explore opportunities to enter adjacent business segments such as renewable energy and real estate private credit. Potentially for the renewable energy business, CLI could look at an infrastructure trust for a portfolio of operating projects.
CLI has a captive demand for renewable energy from its tenants across its data centres and business parks. Thus, the focus is more on supplying power to corporate and institutional clients and not so much on the utility side, Dasgupta said. CLINT commissioned its first captive solar power plant in Tamil Nadu in January 2024.
As for entering into the private credit business for real estate, he said CLI has become interested in it as bankruptcy laws in India have matured. “We are seeing a lot of instances where people have been able to enforce a reasonable period of time in case of defaults,” Dasgupta said.
Also, the Reserve Bank of India has made it very difficult for banks to lend for land acquisition and pre-approval projects. This opens up an interesting opportunity to get good returns for a real estate credit strategy, Dasgupta added.
First Published: Sep 04 2024 | 6:38 PM IST