Frasers Property (FPL) TQ5 has secured a five-year A$340 million ($312.9 million) and US$75 million ($100.4 million) syndicated sustainability-linked loan for its Australia business, Frasers Property AHL Limited (FPAHL).
FPAHL is a subsidiary of Frasers Property Australia Pty Limited (FPA).
The sustainability-linked loan, which has a price reduction structure that adopts sustainability performance targets linked to the group’s goal to be a net-zero carbon corporation by 2050, is a first for FPL. Its key feature is its price reduction structure that provides interest rate savings from the second year if FPAHL achieves a prescribed reduction in its annual absolute greenhouse gas emissions based on its FY2019 footprint.
With this transaction, the proportion of green or sustainability-linked corporate facilities for Frasers Property Limited’s Australian platform stands at 100%.
“Sustainable financing plays an important role in encouraging sustainable development and is an integral part of the group’s net-zero carbon journey as a responsible investor-developer-manager. This is our first sustainability-linked loan tied to a prescribed reduction in annual absolute greenhouse gas emissions, marking our steady progress in green certifying the group’s owned and asset-managed properties. We are delighted that this sustainability-linked loan enabled the group to achieve full sustainability-linked financing for its Australia business,” says Loo Choo Leong, group chief financial officer of FPL.
To date, FPL has secured over $9 billion of green or sustainability-linked loans and bonds since its first green loan in September 2018, making it around half of the group’s net borrowings.
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Shares in FPL closed 1 cent higher or 1.12% up at 90.5 cents on Feb 21.
