Frasers Property bags A$300m sustainability-linked loan in Australia

FRASERS Property Limited's subsidiaries in Australia have jointly obtained a A$300 million (S$309.1 million) five-year syndicated sustainability-linked loan from a syndicate of banks comprising Barclays, Mizuho and UOB.

The loan comes with an accordion option of A$25 million under the Loan Market Association's Sustainability Linked Loan Principles (2019).

It builds in a reducing pricing structure with interest cost reduction from the second year onwards - provided that Frasers Property's subsidiaries maintain a four-star rating or above in their respective Global Real Estate Sustainability Benchmark (GRESB) Development report and GRESB Standing Investments report.

In a press statement on Monday morning, Frasers Property said the Australian government-owned Clean Energy Finance Corporation had committed A$75 million in the sustainability-linked loan.

This will help deploy clean energy technologies in two Australian industrial projects that will "reduce embodied carbon, cut operating emissions and deliver zero carbon energy electricity for tenants at no additional cost", according to the group.

Loan proceeds will be used to install distributed energy generation models at Rubix Connect Estate in Victoria and The Horsley Park Estate in New South Wales to deliver carbon-neutral electricity through on-site solar, battery storage and a biodiesel generator.

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Frasers Property's energy retailer unit, Real Utilities, will provide Climate Active-certified carbon neutral electricity to the properties' common areas and its tenants.

The latest sustainability-linked loan marks Frasers Property's 15th green and sustainability-linked financing since the group raised its first green loan in September 2018.

As at end-2020 the group had clinched green and sustainability-linked financing amounting to S$4 billion. It targets to finance the majority of its new green and sustainable asset portfolio with green and sustainable financing by 2024.

Shares of Frasers Property ended Friday up S$0.03 or 2.5 per cent at S$1.25.