The latest buzzword in the real estate market is for home finance companies to purchase real estate and then lease it out to multinational companies.

ICICI Home Finance has invested Rs 200 crore (Rs 2 billion) in acquiring space in hi-tech cities across India, which are then rented out to IT companies.

Plans are afoot for ICICI Ventures, a venture capital arm of the group, to float a Rs 5,000-crore (Rs 50 billion) property fund over the next three years for investment in the Indian real estate market.

Home finance sector leader Housing Development Finance Corporation proposes to set up a separate entity for acquiring and leasing properties to corporate clients.

The housing finance major proposes to set up a separate entity with 49 per cent equity holding, which will acquire properties and lease them to MNCs.

"There is a good potential for such business in the country as currently there are no institutional property finance companies willing to own property and lease them out to corporates," HDFC chief executive and chairman Deepak Parekh said on Monday. He was speaking on the sidelines of the three-day CoreNet Global India Summit.

ICICI Home Finance, which has already ventured into acquiring significant space in IT parks across the country, has already seen returns in the region of 14-15 per cent, said Rajiv Maheshwari, manager at ICICI Property Service Group, a division of ICICI Home Finance.

"Our Rs 55 crore (Rs 550 million) investment in Hyderabad's Hi-Tech City has seen returns of 14-15 per cent in terms of rental income as a percentage of capital value," he said.

The importance of this development comes on the back of MNCs not willing to go for outright purchase of the properties and developers looking for an exit option post-construction, said Parekh.

Initially HDFC plans to proceed on its own and expects to have something in place in next two to three months. As in the case of the ICICI group, the focus would be on IT parks in Mumbai, Pune, Bangalore, Delhi and Chennai.

The HDFC chief said the capital of the entity would depend upon location of the properties, the tenants and the length of the leases.