Ascott Residence Trust issues $200 mil sustainability-linked bond
Last year, ART acquired the first hospitality trust eco-friendly credit in Singapore, which was used to fund its first growth job – lyf one-north, a co-living residential property certified with Green Mark GoldPLUS by the Building and Construction Authority of Singapore.
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 carry a dealt with discount rate of 3.63% per year, paid semi-annually in arrears.
According to ART, the issuance of the sustainability-linked bond has netted the trust a green premium, or “greemium”, which refers to the lower expense of funding from releasing debt that has a positive environmental effect as contrasted to typical bonds. ART has also dedicated to a sustainability efficiency aim for of greening 50% of its overall portfolio by 2025. To accomplish this, the homes need to obtain a regionally, nationally or internationally recognised green building standard or qualification by an acknowledged third-party.
Ascott Residence Trust (ART) has recently released a $200 million sustainability-linked bond, making it the initial Singapore-listed property trust as well as the initial hospitality trust worldwide to provide such a bond.
In an April 20 news release, ART claims the offer was oversubscribed by 2.2 times on the back of solid demand, causing the bond concern being upsized from $150 million to $200 million. The last orderbook shut at $335 million with orders from across 47 accounts. In regards to capitalist allotment, 79% of the bond issuance headed to institutional investors, while personal financial financiers accounted for 21%.
” Sustainability is primary to every little thing we do at ART. Straightening our financing needs with our sustainability efforts to construct a greener profile shows ART’s focus on liable development,” claims Beh Siew Kim, Chief Executive Officer of ART. “Since 31 Dec 2021, 33% of ART’s profile is green-certified and also we target to environment-friendly the remainder of our portfolio by 2030.”
Earnings from the bond issuance are going to be spent to refinance ART’s existing borrowings. DBS Bank is the sole sustainable money advisor, lead manager as well as bookrunner for the deal.