Interups Inc., a US based Public Company (ITUP) and CNP Business Advisory Services Pvt. Ltd. (CNP), the sole Indian Investment Manager (IM) for SEBI registered Next Orbit Ventures Fund I & II (NOVF) have signed a Joint Venture to launch India’s first Hospitality Real Estate Investment Trust (REIT) – Bharatham Hospitality REIT. NOVF will be the Primary Sponsor Applicant to the REIT through its investments in Hospitality Venture Undertaking from its Real Estate Scheme. The Hospitality REIT size will be around Rs. 1000 Crores.
The joint venture effort is to acquire financially stressed but operationally viable hospitality assets, either directly into the REIT or through SPVs, and leased out to a professionally run Project Management Company.
The REIT is expected to introduce a very dynamically structured financial instrument to the market with a basket of fixed and variable income instruments to be generated from the leasing of properties, asset operations and market investments out of Liquidity Reserves.
The entire sponsor investment is pre-seeded courtesy the joint efforts of ITUP, NOVF, Boston based Argonaut Global, Invest at Source, BNM and Calissa Ventures. Rajani Associates, J Sagar Associates and Jerome & Merchant Partners are advising legal counsel. The regulatory filing is contemplated in the next 90 days keeping the IPO date around January of 2018.
Ajay Jalan, Founder of CNP, who had several firsts to his credit, commented, “The proposal is fast progressing with most of the intermediaries engaged to support, execute and setup the REIT, SPVs and the Project Management Company. This joint venture promotion of Hospitality REIT with Interups will be another first from NOVF. It will offer a clear turnaround to the Hospitality sector by REIT’s initiative to acquire and lease viable and operational assets to professionally run management groups and in exchange for a balanced income dividend to the benefit of the investor of NOVF.”
Laxmi Prasad, majority shareholder & CFO of Interups added, “ITUP broadly serves as a link between capital pools in the US with growth opportunities in India. There is a unique pool of regulated self-directed retirement assets from US Markets, which seeks such low risk long-term growth opportunities worldwide. ITUP has access to these funds and will pool them through specially structured and regulated/exempted investment vehicles and invest into the REIT & NOVF.”