Sustainability-linked loans trump other green finance for local property firms

PROPERTY firms and real estate investment trusts (Reits) bagged nearly half of the green debt raised by Singapore companies last year, with sustainability-linked loans making up the lion’s share, according to an analysis by the Institute of Real Estate and Urban Studies (IREUS).

Lee Nai Jia, deputy director of IREUS at the National University of Singapore, said the real estate sector is likely to be among the leaders in sustainable financing in the immediate future, as there are well-established standards for green building certification.

He expects both green and sustainability-linked financing to increase their market share among the available debt instruments. “Higher oil prices and the imposition of carbon taxes, together with greater investment appetite for sustainable investments, should continue to drive sustainable financing,” Dr Lee added.