Ascott Residence Trust issues $200 mil sustainability-linked bond
“Sustainability is primary to everything we do at ART. Straightening our financing requires with our sustainability initiatives to construct a greener profile demonstrates ART’s focus on accountable growth,” claims Beh Siew Kim, CEO of ART. “As of 31 Dec 2021, 33% of ART’s portfolio is green-certified and also we focus on to eco-friendly the rest of our profile by 2030.”
In an April 20 announcement, ART says the offer 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 last orderbook closed at $335 million with orders from throughout 47 accounts. In terms of capitalist allocation, 79% of the bond issuance went to institutional investors, while personal banking investors accounted for 21%.
Last year, ART received the first hospitality trust eco-friendly funding in Singapore, which was utilized to finance its initial development task – lyf one-north, a co-living home accredited with Green Mark GoldPLUS by the Building and Construction Authority of Singapore.
Proceeds from the bond issuance will definitely be used to refinance ART’s existing loanings. DBS Bank is the single lasting financing adviser, lead manager and bookrunner for the deal.
According to ART, the issuance of the sustainability-linked bond has actually netted the trust a green premium, or “greemium”, which describes the reduced expense of financing from releasing debt that has a favorable ecological influence as compared to conventional bonds. ART has even committed to a sustainability performance intended of greening 50% of its complete portfolio by 2025. To achieve this, the properties should achieve a regionally, nationally or internationally identified environmental structure benchmark or qualification by an acknowledged third-party.
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 is going to mature in April 2027 and bring a taken care of discount rate of 3.63% per annum, paid semi-annually behind.
Ascott Residence Trust (ART) has issued a $200 million sustainability-linked bond, making it the initial Singapore-listed realty trust as well as the first hospitality trust around the world to release such a bond.
