IL&FS investment Managers and Milestone Capital Advisors has launched a realty investment fund called IL&FS-Milestone Fund-I, for investing in leased or rented properties.
The fund expects to raise about Rs 500 crore, with a green shoe option of Rs 500 crore, in case of oversubscription.
The life of the fund is four years and it may be listed after three years. This fund is positioned as an investment option for those who do not want to invest in real estate directly. The funds will invest in office buildings, hospitals, hotels, warehouses and shopping malls.
The fund will remain open for subscription till October 30, 2007.
The fund is targeting an annual yield of 11 per cent (pre-tax) and an internal rate of return of 18-20 per cent (pre-tax) based on appreciation of property price.