Abstract-Considering the dearth for spectrum in the congested microwave band, the next generation of cellular communication systems is envisaged to incorporate part of the millimeter wave (mm-wave) band. Hence recently, there has been a significant interest in beamforming aided mm-wave systems. We consider a downlink multiuser mm-wave system employing a large number of antennas combined with a fewer radio frequency (RF) chains both at the base station (BS) and at each of the user equipment (UE). The BS and each of the UE is assumed to have a hybrid beamforming architecture, where a set of analog phase shifters is followed by digital precoding/combining blocks. In this paper, 1) we propose an iterative matrix decomposition based hybrid beamforming (IMD-HBF) scheme for a singleuser scenario, which accurately approximates the unconstrained beamforming solution, 2) we show that the knowledge of the angle of departure (AoD) of the various channel paths is sufficient for the block diagonalization (BD) of the downlink mm-wave channel and hence for achieving interference free channels for each of the UEs, 3) we propose a novel subspace projection based AoD aided BD (SP-AoD-BD) that achieves significantly better performance than the conventional BD, while still only requiring the knowledge of the AoD of various channel paths, 4) we use IMD-HBF in order to employ SP-AoD-BD in the hybrid beamforming architecture and study its performance with respect to the unconstrained system. We demonstrate using simulation results that the proposed IMD-HBF gives the same spectral efficiency as that of the unconstrained system in the single user scenario. Furthermore, we study the achievable sum rate of the users, when employing SP-AoD-BD with the aid of IMD-HBF and show that the loss in the performance with respect to the unconstrained system as well as the existing schemes is negligible, provided that the number of users is not excessive.