BENGALURU, June 7 -- Investment firm Arnya Realestates Fund Advisors plans to launch its second debt fund this year to raise Rs.1,000 crore, at a time when credit demand from residential developers remains elevated, a top company executive said.

The Category II alternative investment fund (AIF) will target Rs.500 crore in base commitments, with a Rs.500 crore green-shoe option.

The proposed fund follows closely after its maiden real estate debt vehicle, Arnya Real Estate Fund-Debt, which has already deployed Rs.1,000 crore in residential projects and is on track to commit another Rs.200 crore by July.

Developers typically tap banks, non-banking finance companies (NBFCs) and alternative lenders for construction finance, as well as for l...