Prop-tech startup hBits receives SEBI approval of Rs 500 Cr for AIF

hBits, a commercial real estate startup that offers fractional ownership (FA) to investors in Grade A properties, said it has achieved regulatory approval from Securities and Exchange Board of India (SEBI) for its CAT II Alternative Investment Fund (AIF).

This will grant hBits the opportunity to establish an AIF fund with a substantial Assets Under Management (AUM) of Rs 500 crore. Investors who participate in hBits' AIF can anticipate an impressive target Internal Rate of Return (IRR) ranging from 18% to 20%, said a statement by the company.

Founded in 2019 by Shiv Parekh, hBits amalgamates real estate, finance, and technology to create a platform where retail investors can invest money into a property with a foreseeable exit strategy.

"Securing SEBI's regulatory approval for our CAT II Alternative Investment Fund, boasting an impressive Rs 500 crore AUM, is a momentous accomplishment for hBits," said Shiv Parekh, Founder hBits.

"This milestone not only showcases the unwavering trust bestowed upon our platform by investors and regulatory authorities but also signifies our readiness to seize the boundless potential of the commercial real estate market. We are passionately committed to democratising commercial real estate and creating a thriving global market," he added.

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In the last week of May this year, hBits obtained approval from the capital market regulator, signifying the firm's readiness to capitalise on the commercial real estate market.

In addition to its SEBI-approved CAT II AIF, hBits has launched Global Investors Feeder Trust (GIFT), a feeder fund that aims to cater to foreign investors.

“With our SEBI-approved CAT II AIF in place and the proposed of the Global Investors Feeder Trust (GIFT) based feeder vehicle, hBits is excited to offer investment opportunities with superior risk adjusted returns to our investors. We are targeting exceptional Grade-A commercial real estate developments across India," said Mayank Jain, CIO, hBits.

In September last year, hBits raised Rs 20 crore in an angel funding round. Currently, hBits has AUM of Rs 220 crore from its nine existing properties with more than 50,000 registered users having successfully exited a commercial property at an industry best IRR of 17.54%.