CapitaLand Commercial Trust issues 10b yen maiden green bond

CAPITALAND Commercial Trust (CCT) on Monday issued 10 billion yen (S$123.7 million) in eight-year unsecured bonds, bearing a fixed coupon of 0.729 per cent per annum.

This is its first green bond, issued under a new sustainability financing framework set up by CCT's manager to allow the real estate investment trust (Reit) to secure funding from sustainability-centric investors and diversify its funding sources.

Proceeds from the issuance will be used to refinance green buildings in CCT's portfolio, said Kevin Chee, chief executive officer of the manager.

The yen-denominated bond proceeds have been swapped into some S$124.7 million at a fixed annual interest rate of 2.84 per cent, and will mature on Nov 16, 2027.

The green bonds are also part of CCT's S$2 billion multicurrency medium-term note programme which was established in 2007. They are unconditionally and irrevocably guaranteed by CCT's trustee.

CCT's sustainability financing framework facilitiates future issuances of sustainable debt to fund investments that meet environmental and social objectives, including select United Nations' Sustainable Development Goals.

Seven of the Reit's eight Singapore properties have been certified Green Mark GoldPlus and above by the Republic's Building and Construction Authority. These environmentally-friendly buildings include Capital Tower, CapitaGreen and the upcoming CapitaSpring.

Units of CCT were down S$0.01 or 0.5 per cent to S$1.96 as at 1.15pm, after the announcement was made.