IFC commits $ 150 million to HDFC Capital’s H-Dream Fund

Representative image made by AI

New Delhi: International Finance Corporation (IFC) has committed up to $ 150 million as an investor of anchor shares in the H-Dream Fund, a $ 1 billion private credit fund aimed at the development of sustainable, affordable and middle-income homes throughout Urban India. The H-Dream Fund is managed by HDFC Capital Advisors, the private equity arm of HDFC Group and a subsidiary of HDFC Bank.

With a basic size of $ 500 million and an extra $ 500 million green shoe option, H-Dream tries to attract long-term capital from global and domestic institutional investors.

The fund will offer financing for projects that implement the excellence in the design for Greater Efficiencies (Edge) Green Building Framework in line with global sustainability standards.

The initiative is intended to support the construction of at least 25,000 green -certified housing units for affordable and middle income segments in the Urban Centers of India.

“By enabling developers to issue green financing instruments and scales sustainable projects, our collaboration with HDFC Capital aim is to create jobs, build resilience, improve the liveability in cities and determine a benchmark for the future of urban transformation,” said Imad n Fakhoury, Ifc..

India is currently confronted with an urban housing shortage that is estimated at 18 million units in cities Tier-I and Tier-II, with around 275 million people without sufficient and affordable homes.

The IFC expects its investment to help mobilize up to $ 850 million from institutional investors and other sponsors. HDFC Capital has reported that it has already received in principle obligations of around $ 350 million from different global and domestic institutions and family offices.

“This platform will channel worldwide and domestic capital to tackle the most elementary social need for housing in India and we are witnessed interest in global and domestic institutions and Indian family agencies with in principle obligations of ~ $ 350 million in place,” said Vipul Roongta, MD & CAOONTA.

A recent IFC report projects an investment option of $ 1.4 trillion in the India’s Green Buildings Market by 2030, with almost $ 1.25 trillion from the housing sector.

The investment strategy of the H-Dream Fund includes financing at an early stage to tackle the limitations on the supply side in the development of affordable quality and homes in the middle income. The fund will operate under IFC’s environmental and social performance standards and the Edge Green Building Framework.

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