Morgan Stanley invests $90m in Mumbai project

The investment into Sheth's suburban Andheri project will help the real estate firm refinance the debt it had taken out to buy land in Mumbai, two people familiar with the development told Livemint. In 2010, Sheth bought the 10-acre land from Borosil Glass Works for about INR8.8 billion ($175 million).

"The Borosil land project is coming up well and sales have been strong. The project will be developed in phases, totally generating revenues of about INR35 billion over a period of four years," said one of the sources.
The deal involved both debt and equity.

The transaction is Morgan Stanley's first realty investment in India in more than four years, after it invested about $130 million in Pune-based developer Panchshil Realty.

Last November, Morgan Stanley appointed investment banking veteran Shirish Godbole as its head of MSREI India, replacing Naresh Naik, who left the firm to spin off his own investment fund.

Morgan Stanley is said to have invested approximately $750 million in Indian real estate since 2006, and plans to speed up its investments.

The Indian real estate sector is increasingly receiving attention from PE investors. India Infoline Venture Capital Fund, the venture capital arm of the India Infoline Group (IIFL), raised an INR5 billion real estate fund in January. It was the brokerage's first foray into the private equity business.

Red Fort Capital, an India-focused private equity real estate fund, also reached a final close recently on its second real estate fund, amassing $500 million from overseas investors. Last December, Kotak Realty Fund raised INR5.23 billion from domestic LPs for a fund that will provide high-yield debt instruments to real estate developers.

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