Green Buildings
HK$4,389 million
(75.5%)
Green Bonds
The issuance of our first green bond in January 2018 symbolised our deep and on-going commitment to SD. The bond raised US$500 million at a coupon rate of 3.5% and is due in 2028. In 2020, our commitment deepened further, with the issuance of four more green bonds totalling HK$1,934 million.
In 2020, we issued our 2020 Green Finance Report which provides information on the bonds’ green projects and estimated quantitative environmental impacts, including energy and water savings, renewable energy generation and wastewater management impacts, among others.
As at 30th September 2020, 78.8% of the net proceeds from these green bonds had been allocated to the following green projects:
The issuance of our first green bond in January 2018 symbolised our deep and on-going commitment to SD. The bond raised US$500 million at a coupon rate of 3.5% and is due in 2028. In 2020, our commitment deepened further, with the issuance of four more green bonds totalling HK$1,934 million.
In 2020, we issued our 2020 Green Finance Report which provides information on the bonds’ green projects and estimated quantitative environmental impacts, including energy and water savings, renewable energy generation and wastewater management impacts, among others.
As at 30th September 2020, 78.8% of the net proceeds from these green bonds had been allocated to the following green projects:
| Category | Green Bond Issued In | Grand Total | ||
| 2018 | 2020 | |||
| Allocated proceeds | Green Buildings | HK$3,720 million | HK$669 million | HK$4,389 million 75.5% |
| Energy Efficiency | HK$147 million | HK$19 million | HK$166 million 2.9% | |
| Renewable Energy | HK$13 million | HK$1 million | HK$14 million 0.2% | |
| Sustainable Water and Wastewater Management | HK$11 million | - | HK$11 million 0.2% | |
| Total Allocated Proceeds | HK$3,891 million | HK$689 million | HK$4,580 million 78.8% | |
| Unutilised Proceeds | - | HK$1,232 million | HK$1,232 million 21.2% | |
| Total Net Proceeds | HK$3,891 million | HK$1,921 million | HK$5,812 million 100% | |
Allocation of Green Bond Proceeds
(As at 30th September 2020)
Extending our Sustainability-linked Loan Profile
In July 2019, we secured our first sustainability-linked loan, making Swire Properties the first company in Hong Kong to launch a financing mechanism where the interest rate is indexed against improvement in its year-on-year environmental, social and governance (“ESG”) performance.
The agreement with Crédit Agricole Corporate and Investment Bank converted an existing five-year revolving credit facility of HK$500 million, dated August 2017, into a sustainability-linked loan, with the interest rate being indexed against improvement in the Company’s year-on-year ESG performance.
The bank will grant a reduction in the interest rate each year based on whether:
- We retain our listing on the DJSI World; and
- We achieve a target reduction in energy use intensity, measured in kWh/m2 each year, for our Hong Kong portfolio.
In 2020, we made separate agreements with Standard Chartered Bank and DBS to convert a total of HK$2 billion in conventional loans into sustainability-linked loans and secured another HK$1 billion sustainability-linked loan with DBS.
These loans will follow a similar structure, with the interest rates reduced if the Company meets the two criteria above. These loans will be used to finance green projects, including advanced energy-saving technologies and green buildings, and also for investments that support SPL’s SD 2030 Strategy targets.
In July 2019, we secured our first sustainability-linked loan, making Swire Properties the first company in Hong Kong to launch a financing mechanism where the interest rate is indexed against improvement in its year-on-year environmental, social and governance (“ESG”) performance.
The agreement with Crédit Agricole Corporate and Investment Bank converted an existing five-year revolving credit facility of HK$500 million, dated August 2017, into a sustainability-linked loan, with the interest rate being indexed against improvement in the Company’s year-on-year ESG performance.
The bank will grant a reduction in the interest rate each year based on whether:
- We retain our listing on the DJSI World; and
- We achieve a target reduction in energy use intensity, measured in kWh/m2 each year, for our Hong Kong portfolio.
In 2020, we made separate agreements with Standard Chartered Bank and DBS to convert a total of HK$2 billion in conventional loans into sustainability-linked loans and secured another HK$1 billion sustainability-linked loan with DBS.
These loans will follow a similar structure, with the interest rates reduced if the Company meets the two criteria above. These loans will be used to finance green projects, including advanced energy-saving technologies and green buildings, and also for investments that support SPL’s SD 2030 Strategy targets.
Green Loan Further Boosts Green Financing
In August 2020, Swire Properties secured a five-year HK$1 billion green loan facility with OCBC Bank. Our first green loan will fund on-going green building developments and allow us to adopt technologies that can save energy and reduce waste and water usage.
One of the projects that will benefit from the loan is Two Taikoo Place – the companion triple Grade-A office tower to One Taikoo Place – which is set to open in 2022. The new tower is being built to the highest green building and wellness standards, incorporating many green features in its design, and has already earned triple Platinum pre-certifications in WELL, BEAM Plus and LEED.
Guy Bradley, our Chief Executive, commented that, “This newest green financing programme will expand our green capabilities and get us one step closer to reaching our SD 2030 Strategy goals and fulfilling our mission of building vibrant sustainable communities. Whether it’s green bonds or sustainability-linked loans, we continue to raise the bar in this new investment sector, and we’re delighted to work with a forward-looking partner such as OCBC to encourage green financing and do good for the environment.”
In August 2020, Swire Properties secured a five-year HK$1 billion green loan facility with OCBC Bank. Our first green loan will fund on-going green building developments and allow us to adopt technologies that can save energy and reduce waste and water usage.
One of the projects that will benefit from the loan is Two Taikoo Place – the companion triple Grade-A office tower to One Taikoo Place – which is set to open in 2022. The new tower is being built to the highest green building and wellness standards, incorporating many green features in its design, and has already earned triple Platinum pre-certifications in WELL, BEAM Plus and LEED.
Guy Bradley, our Chief Executive, commented that, “This newest green financing programme will expand our green capabilities and get us one step closer to reaching our SD 2030 Strategy goals and fulfilling our mission of building vibrant sustainable communities. Whether it’s green bonds or sustainability-linked loans, we continue to raise the bar in this new investment sector, and we’re delighted to work with a forward-looking partner such as OCBC to encourage green financing and do good for the environment.”
First to Obtain Funding from the Swire Pacific SD Fund
Swire Properties is the first operating company within the Swire Group to receive financing from the Swire Pacific SD Fund, which was established to support and accelerate SD projects to improve sustainability performance through adoption of innovative technologies. We are currently implementing two pilot projects under this scheme that will be executed at a larger scale if they are successful:
- Smart Tenant Waste Reduction and Engagement Solution – monitors tenant level waste disposal and recycling behaviours using smart scales and data-driven insights and engagement activities to gamify tenants’ waste reduction journey and drive behaviour change.
- Integrated Direct Current (“DC”) Microgrid Solution – involves the adoption of DC microgrid infrastructure that can reduce electricity conversion loss between systems and will support PV panels and low-carbon fuel cell applications.
Swire Properties is the first operating company within the Swire Group to receive financing from the Swire Pacific SD Fund, which was established to support and accelerate SD projects to improve sustainability performance through adoption of innovative technologies. We are currently implementing two pilot projects under this scheme that will be executed at a larger scale if they are successful:
- Smart Tenant Waste Reduction and Engagement Solution – monitors tenant level waste disposal and recycling behaviours using smart scales and data-driven insights and engagement activities to gamify tenants’ waste reduction journey and drive behaviour change.
- Integrated Direct Current (“DC”) Microgrid Solution – involves the adoption of DC microgrid infrastructure that can reduce electricity conversion loss between systems and will support PV panels and low-carbon fuel cell applications.