Ascott Residence Trust issues $200 mil sustainability-linked bond
According to ART, the issuance of the sustainability-linked bond has netted the trust a green premium, or “greemium”, which describes the lower price of financing from providing financial debt that has a positive environmental effect as contrasted to traditional bonds. ART has even committed to a sustainability performance target of greening 50% of its complete profile by 2025. To accomplish this, the real estates must achieve a regionally, nationally or internationally recognised environmental structure requirement or accreditation by a recognised third-party.
In 2021, ART received the first hospitality trust eco-friendly finance in Singapore, which was utilized to finance its first growth job – lyf one-north, a co-living real estate certified with Green Mark GoldPLUS by the Building and Construction Authority of Singapore.
Proceeds from the bond issuance will definitely be taken to refinance ART’s existing borrowings. DBS Bank is the sole sustainable financing consultant, lead supervisor and also bookrunner for the deal.
Ascott Residence Trust (ART) has released a $200 million sustainability-linked bond, making it the very first Singapore-listed realty trust and also the very first hospitality trust worldwide to provide such a bond.
In an April 20 news release, ART claims the deal was oversubscribed by 2.2 times on the back of strong demand, resulting in the bond concern being upsized from $150 million to $200 million. The final orderbook shut at $335 million with orders from across 47 accounts. In terms of financier allotment, 79% of the bond issuance went to institutional financiers, while personal banking capitalists made up 21%.
The bond was released under ART’s $2 billion Multicurrency Debt Issuance Programme under its newly-established Sustainability-Linked Finance Framework. The five-year bond will grow in April 2027 and hold a taken care of discount rate of 3.63% per annum, paid semi-annually behind.
” Sustainability is origin to every little thing we do at ART. Straightening our financing requires with our sustainability initiatives to construct a greener portfolio demonstrates ART’s concentrate on responsible growth,” claims Beh Siew Kim, Chief Executive Officer of ART. “As of 31 Dec 2021, 33% of ART’s portfolio is green-certified and also we focus on to green the rest of our profile by 2030.”