India, November 24, 2022: MYRE Capital, India’s first neo-realty investment platform, has today announced the launch of its Lease-Contract Discounting investment vertical to offer first-of-its-kind alternative real estate investment opportunities to accredited Indian and NRI investors. The curated product under this vertical will allow investors to invest in opportunities providing growth capital to managed leasing players secured by hard collateral and lease rental receivables from blue chip sub-tenants. MYRE aims to scale this new vertical to INR 350 crore in FY23.
The minimum investment size for this opportunity is INR 15 lakh with a 13% target Internal Rate of Return.
The new vertical has been structured based on the innovative framework as an adaptation of the ‘Lease Rental Discounting’ model. In such products, the tenure of the investments is kept below the lock-in period for the sub tenants so that the returns of the investors are secured. The monthly rentals are collected in an Escrow account with first disbursement to the investors. With a 13% target IRR, this framework presents a compelling risk-return proposition, providing accredited investors with unprecedented access to differentiated opportunities in the commercial real estate sector. MYRE Capital will operate the vertical offline for now with exclusive opportunities. The platform intends to transition this vertical to online over the next quarter.
MYRE has already seen immense traction from potential accredited investors for the new product. The opportunities in the LRD (Lease Rental Discounting) vertical will offer non-dilutive growth capital to managed leasing operators against contracts with future rental receivables and other repayment guarantee mechanism. The operator uses capital to finance the capex like fitted-out offices that are secured by long term contracts with MNC & blue chip tenants. The sub-tenants’ monthly lease rental services the growth capital offered by investors.
Speaking on the development, Aryaman Vir, Founder & CEO, MYRE Capital said “We are extremely excited to bring forth a distinct investment product in real estate for the first time ever in India. We, at MYRE Capital, are constantly innovating to enable accredited investors to earn an ‘Alpha’ on their returns.”
Our aim is to provide complete transparency and security to our investors therefore the entire principal and interest will be repaid to investors within the lock-in period of the lease contract. We see immense appetite and potential of growth for neo-realty products in India and we aim to scale this vertical to INR 350 crores by the end of next year. We are working on bringing multiple products to the table in the real estate sector for our investors to diversify their portfolio” he added.
To further safeguard the investor’s interest and mitigate risks, MYRE Capital is requiring operators to also provide an overarching guarantee. This means that if on the 12th of any given month, due to any reason whatsoever the funds in the escrow are not sufficient to cover the principal + interest payment to investors, the operator has an obligation to cover the difference by the 15th of the month.