Sundaram Alternates Secures ₹1,000 Crore Commitments for ESG-Aligned Real Estate Credit Fund

Sundaram Alternates, the alternative investment arm of the Sundaram Finance Group, has completed the first close of its SA Real Estate Credit Fund V with capital commitments of ₹1,000 crore, as per news reports, The 1st close was achieved within three months of the fund’s launch in October 2025. 

The fundraise is still open and is expected to conclude by March 2026. The targeted final corpus is in the range of ₹1,500 crore to ₹2,000 crore. Sundaram Finance Group has made a sponsor commitment to the fund. 

Investor Participation 

The commitments have been secured from a range of investors, including insurance companies, family offices, corporate treasuries and ultra-high-net-worth individuals. According to the firm, the investor base shows steady demand for structured credit products in the real estate sector. 

SA Real Estate Credit Fund V is being positioned as an ESG-aligned real estate credit fund, with environmental, social and governance factors forming part of its investment assessment framework. 

Credit Strategy 

The fund will focus on senior secured, amortising loans to brownfield residential projects that are already generating cash flows. Lending will be backed by collateral and structured around conservative loan-to-value ratios. 

ESG parameters are embedded into the underwriting process and ongoing portfolio monitoring. The fund has indicated that risk controls and repayment visibility remain central to its lending approach. 

Sector Context 

India’s real estate sector is projected to reach a value of $1 trillion by 2030 and is expected to contribute about 13% to the country’s gross domestic product. Private credit funds have increasingly been used to address funding needs in residential real estate, particularly for completed or near-completion projects. 

The firm stated that ESG-linked credit strategies are gaining wider acceptance among institutional and private investors in this segment. 

Track Record 

Sundaram Alternates has raised more than ₹3,800 crore across 5 earlier real estate credit funds. These funds have deployed ₹4,140 crore across 73 transactions, with an average contracted internal rate of return of 19.1%. 

The firm has exited 34 transactions worth ₹1,829 crore, reporting an average exit internal rate of return of 20.4%. 

Read More: Andhra Pradesh Leads India in FY26 Investments, Secures 25.3% of Proposed Capital! 

Conclusion 

Following the first close, SA Real Estate Credit Fund V will continue raising capital towards its final target ahead of the planned March 2026 close. 

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