Represents ESR Group’s third sustainability-related loan, which further reinforces its deep-rooted commitment to ESG following the acquisition of ARA
SINGAPORE/HONG KONG – Media OutReach – January 30, 2022 – ESR Cayman Limited (“ESR” or the “Company”, together with its subsidiaries as a “Group”; SEHK Stock Code: 1821) has secured a Sustainability Linked Loan (“SLL”) of 28 billion yen (approximately 243 million dollars) with an option to raise it to 35 billion yen (approximately US$303 million). This represents an important step for ESR as an expanded platform in strengthening its commitment to environmental, social and governance (“ESG”), following the recent completion of the acquisition of ARA Asset Management (“ARA”) ).
The Group secured the loan from a consortium of major Asian banks, including Sumitomo Group strategic investor Mitsui Banking Corporation (“SMBC”) who acted as sustainability advisor and Mandated Lead Manager. Other mandated leads included Mizuho Bank, Ltd. (“Mizuho”) and E.Sun Commercial Bank, Ltd. (“E.Sun”).
The five-year senior unsecured and committed corporate facility is designed with the same tiered inducement mechanism as the group’s first US$1 billion sustainability-linked loan which closed in November 2021. ESR will be entitled to an interest rate reduction (currently at Tibor plus 1.8%) as sustainability goals are achieved. The proceeds will be used to finance the refinancing of the Group’s existing borrowings, working capital requirements and general corporate purposes. This 28 billion yen SLL also follows the US$1 billion sustainability-related ARA loan that recently closed in January. Structured as a USD-SGD dual currency facility, ARA’s five-year unsecured committed facility is also designed with an incentive pricing mechanism to the extent that it achieves its sustainability objectives.
Jeffrey Perlman, President of ESR, said, “ESG is at the heart of our business, playing a key role in every aspect of our operations. With the closing of this financing, I am very pleased that the Group is already realizing on its cost of capital synergies from the acquisition of ARA As the largest real estate asset manager in APAC, we have a sense sharpness of common purpose and a vision to focus on the well-being and long-term priorities of our community and our wider environment. We look forward to using the proceeds of this loan to sustainably improve our assets, our operations and the communities in which we work. »
Jeffrey Shen and Stuart Gibson, co-founders and co-CEOs of ESR, said, “We would like to express our gratitude to SMBC, Mizuho and E.Sun for their recognition of the group’s accomplishments, continued progress and continued focus focused on sustainability. We are also pleased to have expanded our relationship with SMBC, which became ESR’s strategic investor in the acquisition of ARA. are important steps as we seek to integrate sustainability into all aspects of our business in pursuit of our goal of creating a positive impact on our stakeholders and the communities where we operate. »
With the completion of the acquisition of ARA, ESR has become the largest real estate asset manager in APAC powered by the new economy and the third largest manager of listed real estate investments in the world by assets under management. gross of US$140 billion.[1]. The integration with ARA, including its subsidiary LOGOS, also pushes the Group to further strengthen its leadership and its ESG offerings. The 28 billion yen SLL backed by SMBC, Mizuho and E.Sun is a demonstration of these efforts, in addition to recent respective ESR and ARA sustainability-related loans of US$1 billion.
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Chang Rui Hua
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+852 2376 9623
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+852 2376 9617
[1] Based on Group management estimates (including AUM of associated companies – Cromwell and Kenedix) as of December 31, 2021
About CSR
ESR is APAC’s largest real estate asset manager powered by the new economy and the third largest listed real estate investment manager in the world. With $140 billion in gross assets under management (AUM), our fully integrated development and investment management platform spans major APAC markets including China, Japan, South Korea, Australia , Singapore, India, New Zealand and Southeast Asia, accounting for over 95% of GDP in the APAC region, and also includes a growing presence in Europe and the United States. We offer a diverse range of real estate asset investment solutions and new economy real estate development opportunities across our private fund businesses, enabling financial partners and clients to capitalize on the secular trends more significant in APAC. With 14 publicly traded REITs managed by the Group and its associates, ESR is the largest sponsor and manager of REITs in APAC with total assets under management of US$45 billion. Our goal – Space and investment solutions for a sustainable future – drives us to manage sustainably and impactfully and we consider the environment and the communities in which we operate as key stakeholders in our business. Listed on the Main Board of the Hong Kong Stock Exchange, ESR is part of the FTSE Global Equity (Large Cap) Index Series, the Hang Seng Composite Index and the MSCI Hong Kong Index. Mmore information is available at www.esr.com.
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