In an exclusive interaction with Adlin Pertishya Jebaraj, Correspondent at Finance Outlook, Sandeep Agarwal, Executive Director – Finance and Group CFO, Elan Group, shares how CFOs are changing real estate funding approaches in a changing interest rate landscape by focusing on capital efficiency and balanced funding frameworks.

Sandeep Agarwal is an experienced finance professional with more than twenty years in real estate, infrastructure, and corporate finance. With significant knowledge in private equity, banking, and structured finance, Sandeep has effectively led high-value deals and enhanced investor trust through solid financial governance.

How is the evolving interest rate cycle reshaping structured funding strategies in real estate?

The interest rate environment has definitely made us more calibrated in how we approach funding. The focus has shifted from aggressive leverage to optimized capital stacks, where the cost of capital is carefully balanced across debt, equity and structured instruments.

There is a growing inclination towards private credit and platform-level partnerships to retain flexibility. There is also a stronger emphasis on cash flow visibility and faster monetisation. More importantly, the conversation has moved beyond just raising capital. It is now about how efficiently you deploy it, how quickly you can turn it around and its alignment with project cash flows. Hence, structured funding strategies come into play.

What strategies do CFOs use to improve capital efficiency and return ratios?

One of the key things we focus on is ensuring capital is deployed in sync with project milestones. Pre-sales, phased development and selective monetisation are also being used to accelerate cash flows and improve the internal rate of return. Additionally, partnerships through joint ventures or structured equity help reduce balance sheet stress while maintaining project control.

From a CFO’s perspective, it is about ensuring every rupee deployed is tied to a clear revenue visibility timeline. There is also a growing focus on data-led decision-making, where real-time financial tracking enables sharper cost control and better yield optimisation across projects.

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How do you align structured funding with project cash flow cycles and risk profiles?

It starts with mapping the lifecycle of the project in detail, from land acquisition to execution and eventual delivery. Each phase carries a different risk profile and the funding strategy has to reflect that, with short-term capital supporting early-stage risks and longer-tenure funding aligned with execution and sales cycles. As the project progresses and visibility improves, you can bring in longer-tenure and more cost-effective funding.

Contingency buffers and milestone-linked disbursements are critical tools in this process. This ensures that capital remains efficient while also protecting the project from liquidity mismatches or execution delays. Consistent execution and timely repayments further strengthen lender confidence, which in turn allows for more efficient structuring in subsequent phases.

For example, the early repayment of the entire Rs 875 crores fund to Asia Pragati by Elan Group, well ahead of schedule, marks a pivotal milestone in the company’s growth journey. This early repayment not only reduced interest costs and enhanced liquidity but also reinforced lender confidence, creating greater flexibility for future project funding and strategic investments.

What skills are essential for CFOs to manage complex structured funding ecosystems?

The role has evolved quite a bit. Today’s CFO’s are not just looking at numbers; they are deeply involved in strategy. You need a strong grasp of capital markets, different funding instruments and the regulatory landscape. At the same time, you have to be comfortable with stress-testing your assumptions.

Markets can shift quickly and your funding structures need to be resilient enough to handle that. Equally important is stakeholder management. You are constantly engaging with lenders, investors and internal teams, so the ability to align everyone's expectations is critical.  

For example, handling transactions with global investment firms or domestic institutions requires both financial discipline and strategic clarity. Building credibility through consistent financial discipline and a strong repayment track record also becomes a key part of the role. And of course, being data-driven helps in making quicker and more informed decisions.

How do you see structured finance evolving in India’s real estate sector over the next 5–10 years?

Structured finance is expected to become more institutionalised in the coming decade. With increasing participation from private credit funds, AIFs and global investors, capital structures will become more nuanced and tailored.

We will see the greater use of hybrid instruments and portfolio-based financing rather than project-by-project funding. Transparency, governance and compliance will also play a bigger role in attracting long-term capital. As the sector matures, structured finance will not just be a funding tool but a strategic enabler of scale, efficiency and risk management in real estate development.