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CapitaLand Ascott Trust launches $157.4 mil sustainability-linked bond in partnership with IFC

Felicia Tan
Felicia Tan11/1/2022 12:45 AM GMT+08  • 2 min read
CapitaLand Ascott Trust launches $157.4 mil sustainability-linked bond in partnership with IFC
Citadines in Trafalgar Square, London, one of CLAS's properties. Photo: CLAS
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CapitaLand Ascott Trust (CLAS) has priced a 16.5 billion yen ($157.4 million) sustainability-linked bond under its $2 billion multicurrency debt issuance programme.

The bond was launched in partnership with the International Finance Corporation (IFC), where IFC is the sole subscriber of the sustainability-linked bond.

The bond, which is IFC’s first sustainability-linked bond in the hospitality sector, has a fixed coupon rate of 1.05% per annum (p.a.) and is paid semi-annually in arrears.

The seven-year bond will mature in November 2029.

According to CLAS, proceeds from the bond will be used to refinance its existing borrowings and to further decarbonise three of its serviced residences in Southeast Asia, namely Ascott Jakarta in Indonesia as well as Ascott Makati and Somerset Millennium Makati in the Philippines.

The three properties are expected to achieve a 40.5% reduction in electricity consumption by Dec 31, 2028. They are also expected to obtain IFC’s Excellence in Design for Greater Efficiencies (EDGE) certification within the same timeframe.

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The electricity consumption reduction target is said to be aligned with the targets set out under the CapitaLand 2030 Sustainability Master Plan.

Serena Teo, CEO of the managers, says, “We place sustainability at the core of everything we do. Dovetailing our financing efforts with our environmental, social and governance efforts further affirms our commitment towards responsible growth.”

She adds: “To date, CLAS has raised about $450 million through sustainable financing. CLAS continues to collaborate with like-minded stakeholders in the financing and investment community to fight climate change through our collective efforts. Currently, 35% of CLAS’s portfolio is green-certified and we remain on track to green 50% of our portfolio by 2025 and our entire portfolio by 2030.”

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“Our investment will support the decarbonisation of a portfolio of energy-intensive buildings, while also ensuring that the energy reduction is specifically aligned with Net Zero targets,” says Lim Kim-See, IFC’s regional director for East Asia and the Pacific.

Units in CLAs closed 1.5 cents higher or 1.6% up at 95.5 cents on Oct 31.

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