Strutt & Parker has teamed up with a major insurance firm to launch a $1bn (£498m) fund investing in Indian retail property.

Strutt’s property finance arm Strutt & Parker Real Estate Financial Services (SPREFS) has been appointed by Old Mutual to raise $500m (£249m) of equity for the fund.

The team also comprises Indian retail firm ICS Realty. It will partner individual Indian firms and landowners at its redevelopment schemes to fit in with Indian law.

The fund, known as the Triangle Real Estate Fund, will invest in developing shopping centres in India’s rapidly developing cities outside the core ‘Tier 1’ cities, including Mumbai and Delhi.

There are 50 cities in India with more than 1m people, most of which do not have shopping centres.

The fund will focus on developing 1m sq ft plus shopping centres in these cities in a similar mould to Lakeside and Meadowhall.

Philip Ingman, managing director of SPREFS, said: ‘There’s so much opportunity – GDP growth of 8% and a growing middle class population with a huge disposable income and nowhere to spend it. Its an interesting growth area for investors.’

He said the shopping centres that the fund would develop would follow the European model of having anchor tenants and car parking.

The fund has been seeded with $125m of equity from Old Mutual, and the first four deals are signed, including a 1m sq ft shopping centre which is already on site in Aurangabad, about 3.5 hours from Mumbai. The centre is already 60% pre-let.

It has a further 7 deals in due diligence.