Ascott Residence Trust issues $200 mil sustainability-linked bond
Earnings from the bond issuance are going to be spent to refinance ART’s existing borrowings. DBS Bank is the sole lasting finance advisor, lead manager and also bookrunner for the transaction.
Last year, ART obtained the initial hospitality trust green funding in Singapore, which was used 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.
According to ART, the issuance of the sustainability-linked bond has netted the trust a green premium, or “greemium”, which describes the reduced price of funding from issuing financial debt that has a positive ecological impact as compared to conventional bonds. ART has also dedicated to a sustainability efficiency intended of greening 50% of its complete portfolio by 2025. To attain this, the buildings must attain a regionally, nationally or internationally acknowledged green building requirement or accreditation by an acknowledged third-party.
In an April 20 announcement, ART says the bargain was oversubscribed by 2.2 times on the back of solid demand, resulting in the bond issue being upsized from $150 million to $200 million. The final orderbook shut at $335 million with orders from across 47 accounts. In terms of investor allocation, 79% of the bond issuance headed to institutional capitalists, while exclusive financial capitalists accounted for 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 is going to grow in April 2027 and bring a taken care of coupon price of 3.63% per annum, paid semi-annually in arrears.
Ascott Residence Trust (ART) has already released a $200 million sustainability-linked bond, making it the initial Singapore-listed realty trust and the very first hospitality trust worldwide to release such a bond.
” Sustainability is fundamental to whatever we do at ART. Straightening our funding requires with our sustainability efforts to build a greener profile demonstrates ART’s concentrate on responsible growth,” claims Beh Siew Kim, CEO of ART. “Since 31 Dec 2021, 33% of ART’s profile is green-certified as well as we aim at to environment-friendly the rest of our profile by 2030.”