Sundaram Alternates Real Estate Credit Fund V Hits ₹1,000 Crore Milestone:
Sundaram Alternates Real Estate Credit Fund V Crosses ₹1,000 Crore in 3 Months: Why ESG-Aligned Credit is the New HNI Favorite
The Indian private credit landscape has witnessed a significant milestone as Sundaram Alternates (SA), the specialist alternative investment arm of the Sundaram Finance Group, announced that its SA Real Estate Credit Fund V has surpassed ₹1,000 crore in capital commitments. Remarkably, this achievement comes within just three months of its launch in October 2025.
As the first ESG-aligned real estate credit fund in India, this fund is setting a new benchmark for institutional and ultra-high-net-worth (UHNW) interest in structured debt.
Also Read:
Family Office Investments in India: Fueling Startups, Scaleups & Growth-Stage Enterprises
The Milestone: Rapid Capital Accumulation
Launched in October 2025, the fund has reached the ₹1,000 crore mark with impressive speed, reflecting high investor confidence in the Sundaram brand and the specific strategy of the fifth iteration of their real estate series.
- Target Corpus: ₹1,500 – ₹2,000 crore.
- Fundraising Timeline: Expected final close by March 2026.
- Investor Profile: A diversified mix of insurance companies, family offices, corporate treasuries, and UHNWIs.
- Skin in the Game: The fund includes a significant sponsor commitment from the Sundaram Finance Group, ensuring alignment between the fund manager and investors.
Investment Strategy: Safety First with Yield
The SA Real Estate Credit Fund V follows a performing credit strategy. Unlike “distressed” debt funds, this fund focuses on providing senior secured, amortizing loans to brownfield, cash-generating residential projects.
Key Pillars of the Strategy:
- Senior Secured Position: The fund takes a priority claim on the assets, ensuring that in the event of a default, the fund is the first to be repaid.
- Brownfield Focus: By investing in projects that are already under construction and have demonstrated sales momentum, the fund minimizes “execution risk.”
- Capital Protection: SA utilizes conservative Loan-to-Value (LTV) structures—typically capped around 65-70%—backed by registered mortgages on completed or near-completion inventory.
- ESG Integration: As India’s first ESG-aligned realty credit fund, it integrates environmental (green certifications), social (affordable housing), and governance (transparent reporting) criteria into its underwriting process.
Also Read:
Funding and Investment Options to Grow India’s Real Estate & Allied Businesses
Performance Track Record
Sundaram Alternates has built a formidable reputation in the private credit space since 2017. Their track record is a major driver of the current fund’s success:
Metric | Achievement |
|---|---|
Total Raised (RE Credit) | Over ₹3,800 crore across 5 funds |
Total Deployed | ₹4,140 crore across 73 deals |
Average Contracted IRR | 19.1% |
Capital Loss History | Zero capital loss to date |
Exits | 34 full exits totaling ₹1,829 crore |
”Crossing ₹1,000 crore within three months reflects the confidence that investors place in our underwriting discipline and risk framework,” said Karthik Athreya, Managing Director, Sundaram Alternates.
Also Read:
Why Real Estate Credit is Booming in 2026
The success of Fund V is not an isolated event but a reflection of broader market dynamics in the Indian economy:
- Bank Retrenchment: Traditional banks remain selective in lending to developers, leaving a “funding gap” that AIFs (Alternative Investment Funds) are perfectly positioned to fill.
- Residential Demand: With the Indian real estate sector projected to reach $1 trillion by 2030, the demand for mid-market housing in Tier-1 and Tier-2 cities remains resilient.
- The “Search for Yield”: In a volatile equity market, fixed-income alternatives that offer 18-20% IRR with strong collateral backing are highly attractive to sophisticated investors.
Conclusion for Investors
The SA Real Estate Credit Fund V represents a sophisticated evolution of the Indian AIF market. By combining the safety of senior secured debt with the growing necessity of ESG compliance, Sundaram Alternates has created a vehicle that appeals to the modern, conscious, and risk-averse institutional investor.
For those looking to diversify away from traditional equity or low-yield fixed deposits, the private credit space , specifically through established managers like Sundaram continues to offer a compelling risk-adjusted proposition.
Team: IntellexCfo.com
More Featured Articles:
The Ultimate Guide to Company Registration in Dubai 2026: Benefits, Compliance, and Costs
Strategic Finance Options for Medical and Hospital Businesses in India (2026)
Revenue-Based Finance in India 2026: The Ultimate Founder’s Guide to Non-Dilutive Growth Capital
Kotak Mahindra Bank – SME & Wholesale Lending Solutions (₹7–200 Cr)
Expert Guidance on Compliance for Private Limited Companies and LLP in India