Housing revival to boost economic sentiment: FM Nirmala Sitharaman | Business Standard News

Clipped from: https://www.business-standard.com/article/economy-policy/housing-revival-to-boost-economic-sentiment-fm-nirmala-sitharaman-121051400045_1.html

SWAMIH Fund to benefit 116,000 home buyers, help banks and NBFCs grow

Finance Minister Nirmala Sitharaman on Thursday said renewing stalled real estate projects will significantly improve economic sentiment in the country grappling with a second wave of Covid.

This will also boost the portfolios of banks and non-banking financial companies (NBFCs), said the FM at a virtual event where she handed over possession of Rivali Park to home buyers.

The Mumbai-based project, which had been stalled for some time, was completed under the Centre’s special liquidity window — Special Window for Affordable & Mid-Income Housing (SWAMIH-I).

This is the first residential project completed by SWAMIH, which was created in 2019 to fund stuck affordable housing projects.

“The government had stepped in to provide funding to the stressed affordable and mid-income housing projects, thereby giving relief to the home buyers who had invested their hard-earned savings. The government believes that once these homes are constructed and completed, a large amount of capital locked up in these projects will be released,” Sitharaman said.

“It will generate employment for construction workers and will provide impetus to allied industries such as steel and cement. Further, it will improve the portfolios of banks and NBFCs and significantly boost the economic sentiment in the nation.”

SWAMIH is a category-II alternative investment fund, announced by Sitharaman in September 2019 and approved by the Cabinet in November that year. It is currently the largest real estate private equity team in the country, having scaled up from a two-member team at the time of launch to 37 members now.

SBICAP Ventures was appointed as investment manager to the Fund.

“I am very pleased to see that SWAMIH Fund has completed its first residential project. More so, it is an important achievement since the Fund has worked its way through the difficult period of the Covid-19 pandemic,” the FM said. “The Fund, under which 640 people are getting homes today, will benefit 116,000 Indian families.”

The Rs 12,500-crore fund, with a green-shoe option of an additional Rs 12,500 crore, provides financing to enable completion of projects. Two big projects — Mumbai’s CCI Rivali Park and Urban Land Amangani, Rewari — were developed under the scheme.

State Bank of India (SBI) Chairman Dinesh Kumar Khara, who also attended the event, said the Fund is being managed to achieve the huge expectations that have been laid out before SBI and partners.

He said the SBI group is working in line with the government’s vision to revive the real estate sector and provide relief to home buyers.

Khara said in the past 15 months, SBI made significant progress to increase the scale of operations to a level that is generally achieved in three-four years by other private equity funds. The Fund is targeting to complete 116,600 units at a sanctioned cost of Rs 18,546 crore.

So far, SWAMIH has approved 72 projects for completion of 44,100 housing units, while preliminary permission has been granted to 132 projects covering 72,500 units.

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