Lendlease has raised £250 million through its debut pound sterling green bond – testament to ongoing investor demand for sustainable real estate development projects.
The 12-year fixed rate bond pays a coupon of 3.5 per cent and will help the company continue to bring its $114 billion global pipeline of development projects to fruition.
The issuance follows $800 million raised across two successful AUD green bonds in FY21 and reinforces Lendlease’s position as one of Australia’s largest non-bank ASX listed issuers of green, social and sustainability (GSS) bonds. In the past year, Lendlease also completed approximately $1.5 billion of sustainability linked loans denominated in AUD, USD and EUR.
More than 50 per cent of Lendlease financing facilities are now linked to green, social and sustainability criteria to ensure the best outcomes against these three areas.
Bond proceeds will be used to support the delivery of green buildings and earmarked to $1.8 billion of eligible assets, including across eight major urbanisation projects, such as the UK’s International Quarter London where the landmark Pavilion building has been constructed using sustainable glue laminated timber; and the Milano Innovation District in Italy, where 95 per cent of construction waste is being diverted from landfill.
The delivery of these buildings will drive a range of market leading initiatives, with benefits ranging from the lowering of carbon emissions, to reducing the environmental impact of materials and the delivery of health and wellbeing benefits.
This third green bond issue follows Lendlease’s launch of Mission Zero in May to promote its industry-leading sustainability targets:
- The environmental target sets a global benchmark for the real estate industry by becoming a 1.5ºC aligned company and targeting Net Zero Carbon for scope 1 and 2 emissions by 2025, and Absolute Zero Carbon for scope 1, 2 and 3 emissions, encompassing all operations and including the supply chain by 2040.
- The social target signposts Lendlease’s aspiration for delivering positive social benefits to communities through the creation of $250 million of measured social value over five years to 2025, via the shared value partnerships supported by the Lendlease Foundation, going above and beyond Lendlease’s project obligations.
Quote attributable to Simon Dixon, Chief Financial Officer:
“We believe that creating places where communities thrive goes hand in glove with delivering positive environmental and social outcomes while also creating value for our securityholders.
“Despite continuing market volatility in the context of emerging COVID-19 variants
the bond attracted solid interest from investors seeking to support sustainable opportunities.”