Property News · July 25, 2016

Property company issues green bond, a first for Hong Kong


Meanwhile, mainland China has become the biggest issuer of green bonds for 2016
All green in Hong Kong Science Park. Image credit: xiquinhosilva (Flickr)
In a historic first for Hong Kong, a property company has issued a green bond.
Link Real Estate Investment Trust, one of the continent’s largest REITs, issued on Monday a 10-year, USD500-million bond with a coupon rate of 2.875 percent or 145 basis points above U.S. Treasuries.
Link’s green notes was said to have attracted an order book of USD1.65 billion from 88 accounts. The bond will be financing the Kowloon East office development along Kowloon Bay.
Unlike ordinary bonds, green bonds must be earmarked for environmentally friendly projects. The Kowloon East project, which covers 884,000 square feet, will uphold standards set by the Hong Kong Building Environmental Assessment Method and undergo certification by the Leadership in Energy and Environmental Design, reported the South China Morning Post.
Its target completion date is June 2020.
Around 86 percent of the notes went to Asian investors, reported the Nikkei Asian Review. Forty-five percent of creditors consisted of banks, while 5 percent were insurers.
Link’s building project, worth HKD10.5 billion (USD1.35 billion), is widely seen as a face-saving effort for the trust, accused of exorbitantly pricing car rents in public housing estates for low-income residents. The trust has also suffered a very public rebuke from Hong Kong Chief Executive Leung Chun-ying.
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Hubert Chak, Link’s finance director, insisted that “sustainable development” has always been the trust’s “core value.” According to The Standard, Link’s office project will rise up to certain green building standards.
Meanwhile, in mainland China, residents are grappling with record levels of smog and pollution in recent years. Seemingly in atonement, China grew to become the biggest issuing nation for green bonds in the first half of 2016, then issuing USD8.9 billion in notes.
This month alone, Bank of China sold an unprecedented USD3.03 billion in green bonds.
Sustainability is an agenda that seems to imbue Asian property development lately, with green buildings rising everywhere from Seoul to Kuala Lumpur.
Singapore was recently voted the world’s second-best city for green buildings, while the Taipei 101 in Taiwan was certified as the world’s tallest green building.
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Source : property-report.com
Read more…Property company issues green bond, a first for Hong Kong

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