In a new trend in the real estate finance sector, many senior executives of national and global firms are quitting their jobs to start their own ventures. Sector experts say a major trigger for executives turning to entrepreneurship is the high demand for money from alternative investment funds to buy land amid increased restrictions on non-bank financial companies.
In recent months, about half a dozen such executives have quit their jobs to launch their own funds, the latest being Nipun Sahni, a partner at US-based investment giant Apollo Global Management.
Sahni is likely to set up a fund to invest in real estate. “Apollo has agreed to anchor a real estate fund if Sahni decides to launch it,” said a source.
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“Apollo has been the best chapter in my 30-year career… I am looking forward to start the next phase as an entrepreneur,” Sahni said, adding that he now advises Apollo on its entire real estate portfolio and investments in the country .
Sahni has invested and managed over 20,000 crore rupees in his long career. He has headed Apollo since 2015. Prior to Apollo, he headed Merrill Lynch’s country real estate fund. He has completed over 50 deals including deals with Ascendas, Piramal, DLF, Lodha, Runwal, Sattva Salarpuria and Ambasada.
In addition to Sahni, Mumbai-based Ankur Gulati, managing director of real estate investments at Canada’s CPP Investments (CPPIB), has stepped down after about 10 years with the firm. He is looking to set up an alternative investment fund (AIF) in public stocks. When contacted, Gulati declined to comment.
Other real estate finance executives turning to entrepreneurship include Ashish Singh, partner, head of India and Southeast Asia, real estate at UK-based private equity firm Actis; Amar Merani, Chief Investment Officer and Head of Real Estate Assets at 360 One Asset; Avinash Sule, Executive Director, Industrial & Logistics & Hospitality at development and investment firm RMZ; and Chanakya Chakravarti, head of indirect investments, Asia-Pacific, Ivanhoe Cambridge, CDPQ’s real estate arm.
Singh may take on an entrepreneurial role after his transition from Actis, the people familiar with the matter said, adding that he will remain with the firm until the end of next year.
Merani, who is serving his notice period at 360 One Asset, is believed to be considering offering a fund or starting a proptech company or both, sources said. Merani, who previously worked with Xander Finance, could not be reached for comment.
Sharad Mittal, CEO of real estate funds at Motilal Oswal Alternates, resigned last year to start his own fund management firm.
Shobhit Agarwal, managing director of Anarock Capital, said senior executives of financial companies have been busy refinancing for the past decade and then got involved with stressed assets. “Now there is not much to do. They were used to high activity, which has slowed down now. That is why they are looking at equity,” said Agarwal.
The action has also moved from the private to the public side as many companies are listed, he said. Another executive who recently quit said that after the 2018 IL&FS crisis, NBFC activity has slowed down in the real estate sector and demand for AIF money has increased as these entities are less regulated.
“NBFCs have restrictions on lending for land purchase, while FIAs have no such restriction. That is why people are looking at floating equity,” he said, adding during 2015-16 many senior real estate executives quit and joined NBFCs as the latter saw a high demand for funds .
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