Sustainable finance

Providers of property debt can benefit from progress in ESG data and benchmarking provision, argues GRESB’s Josien Piek.

Effectively one step removed from real estate assets, lenders have not been at the forefront of the industry’s sustainability commitments. However, recent sustainable financing initiatives suggest times may be changing.

While real estate debt providers have made less progress than their equity counterparts to incorporate environmental, social and governance considerations into their strategies, some lenders have shown how it can be done.

The French REIT sources its second debt facility to be indexed on its GRESB rating.

A syndicate of 15 banks signs the five-year loan, with the margin of the debt facility linked to the French group’s ESG performance.

A £27m facility will be used by the business, which rents space to charities and social enterprises, to back its growth plans and a London office development.

Lenders stand to benefit from the growth of an ethical real estate finance market, beyond the obvious reasons.

The fund will focus on making debt investments that provide environmental or social benefits.

A loan deal between ING and Gecina is the first to be indexed on its GRESB rating.

The senior 10-year notes carry a 1.5% coupon.