Bangalore: The asset management arm of LIC Housing finance has raised $47 Million for its private equity according to a senior executive of the company. The fund had launched a target of $100 Million last year with a green shoe option of $47 Million as reported by Times of India.

"We have raised $47 Million so far from institutional investors like banks and corporate. We also have additional commitment of about $8 Million and are hopeful to finish fund raising by June end," said AK Sharma, CEO of LIC Housing Finance.

The funds will be mainly focused on urban real estate like developing IT parks, ware houses and mid income housing across the tier2 and tier3 cities. Targeted at about 22 percent net internal return, the company has already attracted several proposals. With a history that shows LIC’s affinity towards retail investors, the recent movements have hinted that the organization is looking for institutional investors this time around.

"There is a huge demand for mid income category homes in the range of Rs 1,600-4,000 per sq ft and we will target such opportunities. Retail investment in private equity is yet to pick up. Retail investors do not understand the risks and rewards associated with the business," said Sharma about their new prospect.

LIC will not be the lone player in the game of real estate private equity. There have been many investment companies like HDFC Property Fund, JP Morgan Asset Management, IndiaReit Fund Advisors and Kotak Realty Fund who have dedicated real-estate funding groups.