Piramal Enterprises (PEL) has announced a strategic partnership with Ivanhoé Cambridge, a real estate subsidiary of CDPQ (Caisse de dépôt et placement du Québec), to provide long term equity capital to blue chip residential developers across the five major metro cities in India.

Ivanhoe Cambridge is allocating an initial USD 250 million for this purpose. PEL will commit an additional amount alongside and co-invest between 25% and 50% of each transaction.

There is a strong demand for equity in the capital stack as blue chip real estate developers increasingly prefer the option of partnering with investors in the early stages of the development life cycle over high cost financing.

Naturally, the capital will be made available to a selective list of Grade A developers who have already demonstrated a track record of execution capability, corporate governance and strong return potential. The investment focus shall include the Mumbai Metropolitan Region, Delhi (NCR), Bangalore, Pune and Chennai.

Ajay Piramal, Chairman, Piramal Enterprises, said, ''We are extremely pleased to be partnering with Ivanhoé Cambridge, a global institutional leader of great reputation with a long term value system and investing philosophy aligned with our own. Given the scale of our existing real estate offering and roster of existing developer relationships, the partnership will enable us to execute on very compelling opportunities to deliver high quality residential developments in the local markets that we service.''

Shares of the company declined Rs 38.5, or 2.03%, to trade at Rs 1,859.45. The total volume of shares traded was 7,034 at the BSE (3.17 p.m., Thursday).