Our Five Pillars
We at IPAL, believe in formulating fund products tailored to the opportunities available but often mis-understood and/or about which there is a lot of mis-information. Having said that, the following are the basic tenets of our broad investment philosophy:
- Conservative Under-writing
- Downside Protection
- Investment Selection
- Value-add Role
- Strong Governance
We, at IPAL always believe that following a conservative under-writing ethos, is one of the best buffers against fluctuations in market conditions. Whether it be execution timeframe, construction costs, sales velocity and price appreciation, we always believe in factoring in a reasonable buffer in assumptions, to ensure and protect against variations in business plans.
We firmly believe in the adage “If you take care of the downside, the upside will take care of itself”. We are strongly of the opinion that if capital is protected, you can always subsequently compensate for opportunity loss, by capitalising on subsequent opportunities. Our methodologies of downside protection include independent collateral with margin, developer alignment, priority distributions and strong asset management strategies.
Project / investment selection: A key ingredient for any fund to succeed. In real estate projects, these include competition/supply mapping, focus on ‘ticket size’ and ‘right-sizing’ for end-user catchment, layout project, new infrastructure, partner track record, status of approvals/sanctions, etc.
Partner Selection: Partnering with leading, fast-growing and scalable developers who are aligned to our interests is another critical aspect of investment identification.
IPAL believes in being ‘value-add’ investors and not just pure financial investors in real estate projects. The team, given its deep-rooted understanding of real estate nuances, likes to ‘get its hands dirty’. In its earlier and current avatars, the team has often had, and continues to have, the opportunity to jointly collaborate with its developer partners and add significant value on aspects such as design and planning, product positioning, pricing/sales strategy, etc. This quite often, further aids in enhancing investor returns.
In all IPAL investments, strong post-investment governance and monitoring is of paramount importance. We closely monitor execution of our investee projects while retaining preferential rights and privileges. Whether it be board seats, reserved matters, joint project account operation or takeover rights, we implement a strong and robust asset management strategy, and ensure our active involvement in key decision making and the active monitoring of the project which in turn boosts timely execution and delivery.