Ascott Residence Trust issues $200 mil sustainability-linked bond
Earnings from the bond issuance will be used to re-finance ART’s existing borrowings. DBS Bank is the sole lasting money consultant, lead supervisor and also bookrunner for the transaction.
According to ART, the issuance of the sustainability-linked bond has actually netted the trust a green premium, or “greemium”, which refers to the reduced expense of funding from releasing financial debt that has a positive ecological impact as contrasted to traditional bonds. ART has even dedicated to a sustainability efficiency intended of greening 50% of its overall portfolio by 2025. To accomplish this, the residences have to achieve a regionally, nationally or internationally acknowledged eco-friendly building specification or qualification by a recognised third-party.
The bond was issued under ART’s $2 billion Multicurrency Debt Issuance Programme under its newly-established Sustainability-Linked Finance Framework. The five-year bond will develop in April 2027 as well as carry a taken care of discount price of 3.63% per annum, paid semi-annually in arrears.
” Sustainability is fundamental to every little thing we do at ART. Straightening our financing needs with our sustainability efforts to build a greener portfolio shows ART’s concentrate on accountable development,” states Beh Siew Kim, CEO of ART. “Since 31 Dec 2021, 33% of ART’s portfolio is green-certified as well as we focus on to eco-friendly the rest of our profile by 2030.”
In 2021, ART obtained the initial hospitality trust green financing in Singapore, which was utilized to finance its first advancement project – lyf one-north, a co-living building accredited with Green Mark GoldPLUS by the Building and Construction Authority of Singapore.
In an April 20 announcement, ART claims the deal was oversubscribed by 2.2 times on the back of solid need, resulting in the bond issue being upsized from $150 million to $200 million. The final orderbook shut at $335 million with orders from throughout 47 accounts. In terms of financier allotment, 79% of the bond issuance headed to institutional financiers, while personal banking financiers made up 21%.
Ascott Residence Trust (ART) has already issued a $200 million sustainability-linked bond, making it the initial Singapore-listed real estate trust as well as the initial hospitality trust internationally to provide such a bond.