The Business Times

OUE C-Reit to refinance borrowings with S$978 million sustainability-linked loan

எஸ். வெங்கடேஷ்வரன்
Published Wed, Aug 17, 2022 · 11:37 PM

MAINBOARD-LISTED OUE Commercial real estate investment trust (C-Reit) : TS0U 0% successfully completed a S$978 million unsecured sustainability-linked loan to refinance existing secured borrowings.

The loan, syndicated by a consortium of 4 mandated lead arrangers and bookrunners – CIMB Bank Singapore, Maybank Singapore, OCBC and Standard Chartered - was 1.26 times oversubscribed and supported by 19 banks, the Reit manager announced in a press statement on Wednesday (Aug 17).

“With the new facility in place, there are no further refinancing requirements until September 2023 where only S$291 million of debt is due,” the manager noted.

Post refinancing, the average term of debt as at Jun 30 will lengthen to 3.2 years on a pro forma basis with the weighted average cost of debt expected to remain largely stable, it added.

The proportion of the Reit’s unsecured debt will also increase significantly from 30.9 per cent to 70.2 per cent on a pro forma basis.

This is the largest sustainability-linked loan extended to a Singapore Reit till date, noted chief executive officer and executive director of the Reit manager, Han Khim Siew.

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“Significantly increasing the proportion of unsecured debt is an important step in our prudent and proactive capital management strategy which will enhance OUE C-Reit’s access to more diverse and competitive funding sources while keeping borrowing costs stable,” Han added.

Sustainability-linked loans now account for 58 per cent of OUE C-Reit’s total debt. These loans incorporate interest rate reductions linked to predetermined sustainability performance targets which are aligned with the Reit’s commitment to reduce the environmental impact of its portfolio, the filing noted.

OUE C-Reit has set energy and water intensity reduction targets of 25 per cent below 2017 levels, to be achieved by 2030.

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