Ascott Residence Trust issues $200 mil sustainability-linked bond
In an April 20 announcement, ART states the offer was oversubscribed by 2.2 times on the back of strong need, resulting in the bond difficulty being upsized from $150 million to $200 million. The final orderbook shut at $335 million with orders from throughout 47 accounts. In regards to capitalist allotment, 79% of the bond issuance headed to institutional capitalists, while personal financial capitalists made up 21%.
Ascott Residence Trust (ART) has provided a $200 million sustainability-linked bond, making it the first Singapore-listed real estate trust and the very first hospitality trust internationally to release such a bond.
” Sustainability is origin to everything we do at ART. Straightening our financing needs with our sustainability efforts to build a greener portfolio demonstrates ART’s concentrate on accountable development,” says 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 eco-friendly the rest of our profile by 2030.”
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 funding from releasing financial obligation that has a positive natural effect as contrasted to typical bonds. ART has also committed to a sustainability efficiency aim for of greening 50% of its total profile by 2025. To accomplish this, the properties need to achieve a regionally, nationally or internationally recognised green structure specification or qualification by a recognised third-party.
Last year, ART secured the first hospitality trust environment-friendly financing in Singapore, which was made use of to finance its first advancement job – lyf one-north, a co-living home licensed with Green Mark GoldPLUS by the Building and Construction Authority of Singapore.
Earnings from the bond issuance will be used to re-finance ART’s existing borrowings. DBS Bank is the sole lasting money advisor, lead supervisor as well as bookrunner for the transaction.
The bond was provided 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 hold a repaired coupon price of 3.63% per year, paid semi-annually behind.