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Trump Jr to raise $1bn India property fund

Donald Trump’s son is reportedly targeting India’s growing middle class with ‘high-end, luxury’ developments. Trump Jr said Mumbai would be his first point of entry into the country. The fund, he said, would start off small but grow as the Trump Organization grew more familiar with India.

Donald Trump’s son is trying to raise a $1 billion (€631 million) property fund to capitalize on India’s economic growth with plans to develop “high-end” luxury projects, initially in Mumbai.

With real estate valuations correcting across the country, Donald Trump Jr. told Bloomberg the time was right for the Trump Organization to enter the market. The fund, expected to target as much as $1 billion according to the report, would be for acquisitions of real estate “in the high end, and across the spectrum,” he said. The Trump Organization was unavailable for comment.

The fund would start off “relatively small” and grow as the New York-based firm grew “more familiar with the Indian market.”

Trump Jr told Bloomberg, the firm would also consider buying land owing to the recent slowdown in the real estate market. “The pendulum has started shifting back a little bit to the point where prices have started to become a bit more reasonable,” the executive vice president said. “It will allow companies such as ours to justify buying land. It's a good opportunity for us.”

He added that Mumbai would be the first location as “that's the place where one is going to achieve the highest prices per square foot. It sets the tone for all of the other future developments.”

Trump Jr. told Bloomberg the Trump Organization also plans a residential and hotel project in Mumbai with a local partner to tap increasing affluence in the country.

“Our entry has to be in Mumbai and that's where everything is going on right now in terms of the high-end real estate,'' Trump Jr. told Bloomberg. “That's the place where one is going to achieve the highest prices per square foot. It sets the tone for all of the other future developments.”

India has become an attractive location for private equity real estate investments. Last month, Lehman Brothers Real Estate Partners invested Rs7.4 billion ($175 million; €113 million) in a joint venture with India’s second largest development company, Unitech, to build more than one million square feet of office space in Mumbai. The investment, which gave Lehman Brothers a 50 percent stake in the JV, will be the first in a series of deals with Unitech, and involves developing one million square feet of office space on a 100-acre plot of land running alongside the Western Expressway of Mumbai.

Deutsche Bank’s real estate arm, RREEF, is also planning to invest $1 billion in India across the real estate and infrastructure sectors, recently opening an office in Mumbai to spearhead operations. RREEF India Advisors, as the local business is called, is being led by Kishore Gotely, who left Indian private equity house ICICI Venture last September, where he headed their $550 million real estate fund.