Ascott Residence Trust issues $200 mil sustainability-linked bond

In 2021, ART acquired the very first hospitality trust eco-friendly finance in Singapore, which was utilized to fund its maiden growth project – lyf one-north, a co-living residence certified with Green Mark GoldPLUS by the Building and Construction Authority of Singapore.

In an April 20 news release, ART claims the deal was oversubscribed by 2.2 times on the back of solid demand, leading to the bond concern being upsized from $150 million to $200 million. The final orderbook closed at $335 million with orders from across 47 accounts. In regards to investor allotment, 79% of the bond issuance went to institutional investors, while private banking investors accounted for 21%.

” Sustainability is primary to whatever we do at ART. Straightening our financing requires with our sustainability initiatives to construct a greener profile shows ART’s concentrate on accountable growth,” says Beh Siew Kim, Chief Executive Officer of ART. “Since 31 Dec 2021, 33% of ART’s portfolio is green-certified and also we aim at to green the remainder of our portfolio by 2030.”

According to ART, the issuance of the sustainability-linked bond has netted the trust a green premium, or “greemium”, which refers to the reduced expense of funding from releasing debt that has a favorable natural influence as contrasted to standard bonds. ART has also dedicated to a sustainability efficiency target of greening 50% of its total portfolio by 2025. To achieve this, the residential properties should achieve a regionally, nationally or internationally recognised eco-friendly structure specification or qualification by an acknowledged third-party.

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Ascott Residence Trust (ART) has provided a $200 million sustainability-linked bond, making it the initial Singapore-listed real estate trust and also the first hospitality trust globally to release such a bond.

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 mature in April 2027 as well as carry a taken care of discount rate of 3.63% per annum, paid semi-annually behind.

Proceeds from the bond issuance are going to be utilized to re-finance ART’s existing loanings. DBS Bank is the single lasting finance adviser, lead supervisor as well as bookrunner for the purchase.

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