Qatar fund in talks to invest $200m in Indian property

Updated 23 December 2013

Qatar fund in talks to invest $200m in Indian property

MUMBAI: Qatar Investment Authority (QIA), the sovereign wealth fund of the gas-rich Gulf emirate, is in talks to invest $200 million in residential property in India, a source with direct knowledge of the matter told Reuters.
QIA is holding “conversations” with Kotak Realty Fund, run by Kotak Mahindra Bank Ltd., which would manage the investments on behalf of the fund, said the source, who asked not to be named because the deal has not been finalized.
Kotak would also make a small investment and plans to focus on residential property developments in major cities across Asia’s third-largest economy for QIA, the source said.
Kotak declined to comment. QIA did not respond to emails or telephone calls.
Sovereign wealth funds and other long-term investors are eyeing opportunities in India’s real estate sector, betting that property prices are bottoming out after slumping this year on the back of the slowest economic growth in a decade.
House sales in major Indian cities, including Mumbai and Delhi, fell 22 percent in the quarter ended Sept. 30.

House prices grew by 9 percent over the same period compared with double digit increases in the year-ago quarter, according to property data firm Liases Foras.
Vikram Gandhi, founder of Delhi-based VSG Capital Advisers, which has been retained by Canada Pension Plan Investment Board (CPPIB) to seek investment opportunities in the country, said the timing to invest in Indian property was ideal.
“If you have a long-term perspective and you believe that the need for capital in a country is quite high, which it is, and the supply is limited right now because people are not investing, then this is the best time to invest,” he said.
In November, CPPIB said it would invest $200 million dollars to buy leased, income-producing office buildings in a joint venture with Indian construction company, Shapoorji Pallonji Group, which will invest $50 million.
QIA’s investment comes after the Abu Dhabi Investment Authority in July also appointed Kotak to invest $200 million in Indian real estate on its behalf, sources told Reuters at the time.
Also in July, Singapore’s GIC Pte Ltd., Temasek Holdings and Oman’s State General Reserve Fund committed to investing a combined $200 million in a real estate fund run by Indian mortgage lender HDFC Ltd.
The investments are a shot in the arm for India’s property developers, many of whom are burdened with debt that is expensive to service at steep interest rates.
Banks are also reluctant to lend because of fears of defaults, while private equity funds, which poured in billions of dollars at the height of the property market in 2007, have turned cautious after project delays impacted returns and exits.


Popeyes flexes its muscles in China as KFC feels the heat

Updated 58 min 6 sec ago

Popeyes flexes its muscles in China as KFC feels the heat

  • Popeyes signed a lease in Shanghai for its first store in China on Monday

SHANGHAI: US fried chicken chain Popeyes wants to become the top chicken brand in China, the chief executive of its parent company said on Tuesday, as it prepares to take on KFC, the leading player in the world’s most populous market.

Popeyes signed a lease in Shanghai for its first store in China on Monday, which is expected to open next year.

The company outlined plans in July to build 1,500 restaurants in China in the coming decade, becoming the last of Toronto-based Restaurant Brands International Inc’s main brands to enter the country.

By contrast, Yum China’s KFC has about 6,300 stores. Yum has said that it is acutely aware there is more opportunity to expand in China, noting that while it was in 1,300 Chinese cities, there are still as many as 800 cities without a KFC store.

Popeyes’ July plan was “just really to put a framework on the short-term potential business,” Jose Cil, RBI’s CEO said in an interview in Shanghai.

“I think we can be the No. 1 chicken brand here in China and all around Asia,” he said, adding that consumers in the region were looking for options. He dismissed concerns that a slowing China economy and trade tensions had dimmed prospects for growth in the long term.

Cil’s remarks comes as the Cajun-inspired fast food chicken chain experiences a surge in popularity in the US after a newly launched fried chicken sandwich went viral on social media.

Demand was such that Popeyes had to stop taking orders after only two weeks before relaunching it this month.

The sandwich will also be offered in China, he said.

Cil noted that RBI’s other two main brands had seen rapid growth in China.

Burger King has expanded to around 1,100 stores in China from less than 100 in 2012. “We think we’ll keep growing at a steady pace,” Cil said.

And Tim Hortons, its Canadian coffee chain, just opened its 28th store in China after launching there in February.

“We are preparing ourselves to be able to accelerate growth in the coming years,” Cil said of
the brand.