Sabana Reit obtains S$150m sustainability-linked loan from HSBC

SABANA Industrial Real Estate Investment Trust (Sabana Reit) M 1GU has secured its maiden sustainability-linked loan, amounting to S$150 million, from HSBC.

The loan comprises a 4-year tranche of S$75 million and a 5-year tranche of the same amount.

Its interest rate will be pegged to pre-determined annual energy and water intensity targets for Sabana Reit's across its portfolio, and the Reit will be entitled to lower pre-agreed interest rates on the facility if these targets are met.

In its announcement on Monday (Feb 28), the manager said all of Sabana Reit's loans will be unencumbered with this facility in place.

Proceeds of the loan will be used to refinance existing indebtedness and for general corporate purposes, asset acquisitions, asset enhancement initiatives and working capital requirements.

"Beyond giving us greater financial flexibility, this loan underscores our commitment to integrate sustainability in our operations, minimise our environmental impact and deliver growth in a responsible manner," commented Lim Wei Huang, chief financial officer of the manager.

Units of Reit were trading unchanged at S$0.45 as at 9.45 am, after the news.

READ MORE: 

• S-Reits on journey to raise sustainability standards
• S-Reits seek out green and sustainability-linked loans
• Sabana Reit posts 31.4% drop in H2 2021 DPU to S$0.0157; seeks growth via AEIs, acquisitions
• A closer look at the ESR-Sabana deal