Ascott Residence Trust issues $200 mil sustainability-linked bond
According to ART, the issuance of the sustainability-linked bond has actually netted the trust a green premium, or “greemium”, which describes the reduced cost of financing from releasing debt that has a positive environmental influence as contrasted to typical bonds. ART has also dedicated to a sustainability performance intended of greening 50% of its total portfolio by 2025. To accomplish this, the homes have to obtain a regionally, nationally or internationally identified environmental structure benchmark or accreditation by a recognised third-party.
In 2021, ART secured the initial hospitality trust green loan in Singapore, which was utilized to finance its maiden development job – lyf one-north, a co-living building certified with Green Mark GoldPLUS by the Building and Construction Authority of Singapore.
Proceeds from the bond issuance will be used to re-finance ART’s existing borrowings. DBS Bank is the single lasting money consultant, lead supervisor and also bookrunner for the purchase.
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 is going to develop in April 2027 and also hold a repaired coupon price of 3.63% per year, paid semi-annually behind.
Ascott Residence Trust (ART) has recently issued a $200 million sustainability-linked bond, making it the initial Singapore-listed property trust as well as the initial hospitality trust internationally to release such a bond.
In an April 20 announcement, ART states the deal was oversubscribed by 2.2 times on the back of solid demand, leading to the bond difficulty being upsized from $150 million to $200 million. The last orderbook shut at $335 million with orders from across 47 accounts. In terms of investor allowance, 79% of the bond issuance headed to institutional financiers, while private banking investors represented 21%.
” Sustainability is fundamental to everything we do at ART. Aligning our funding needs with our sustainability efforts to build a greener profile demonstrates ART’s emphasize liable development,” claims Beh Siew Kim, Chief Executive Officer of ART. “As of 31 Dec 2021, 33% of ART’s portfolio is green-certified and we target to environment-friendly the remainder of our portfolio by 2030.”