Motilal Oswal Alternates' real estate fund, India Realty Excellence Fund IV (IREF IV), has successfully closed after exiting all 37 investments in its portfolio, delivering a 20.4% portfolio internal rate of return (IRR). According to reports from Business Standard, the ₹1,155-crore domestic real estate fund, launched in 2020, provided structured capital to established developers at the pre-approval stage across seven cities. The fund invested alongside developers including Casagrand, Puravankara, Kolte Patil Developers, Urbanrise, Phoenix, Rajapushpa, Ashwin Sheth and Radiance Realty, among others. As per Motilal Oswal Alternates, this closure marks a significant milestone for their real estate investment platform.
IREF IV had to navigate several disruptions during its investment lifecycle, including the Covid-19 pandemic, rising interest rates and input costs, as well as geopolitical tensions and conflicts in the Middle East. According to MO Alternates, when COVID-19 brought the sector to a standstill, the firm chose patience over haste, staying close to and supporting developer partners while waiting for clarity on sales, collections and construction before taking timely informed decisions on each investment. As reported by Business Standard, these factors created pressure on residential sales and collections, funding availability, construction costs and project execution timelines. The fund's strategy during these periods focused on capital protection, disciplined underwriting and active asset management.
The closure of IREF IV follows the full exit of India Realty Excellence Fund II (IREF II) in April 2025, which delivered a portfolio IRR of 18.3%. According to Business Standard, with IREF IV now fully realised, three of MO Alternates' six real estate funds have been fully exited, while two others have made significant payouts to investors and are progressing towards full exits. The platform's latest vehicle, IREF VI, remains in its investment phase and is deploying capital selectively into residential projects with established developers. As reported by Motilal Oswal Alternates, institutional investment in Indian real estate has increasingly shifted towards structured credit and alternative capital, alongside traditional private equity investments, as banks remain selective in lending to developers.
MO Alternates said its real estate platform has funded the development of more than 100 million sq ft across six real estate funds, its wholesale business and proprietary book. As reported by Business Standard, the platform has cumulative assets under management of more than ₹11,000 crore, with more than 200 investments and over 150 completed exits. The broader MO Alternates platform manages more than $3 billion in cumulative AUM across real estate, private equity and private credit. According to Motilal Oswal Alternates, this shift towards structured credit and alternative capital has emerged as an important source of capital for residential and commercial projects, particularly at the pre-approval and construction stages.
The successful exit from IREF IV comes as India's residential real estate market has become more formalised and consolidated, according to MO Alternates. According to Business Standard, Vishal Tulsyan, Co-founder and Executive Chairman, MO Alternates, said Indian real estate today is more formalised, consolidated and transparent than at any point in its history, and credible developers are scaling across cities on the back of sustained housing demand. He said this growth would require patient, structured capital and that the firm intends to use its developer network and investment framework to participate in the sector's next phase. As reported by Motilal Oswal Alternates, this formalisation and consolidation has created opportunities for alternative investment platforms to provide structured credit and private credit solutions to developers.
