A fund sponsored by CBRE Global Investors has priced its inaugural Green Eurobond debt offering of senior unsecured notes raising €500 million. The issuance marks the first ever Issuance Direct from a SICAV Structure in the Investment Grade Corporate Bond Market, as well as the first issuance executed directly from a fund-level entity.
The Green bond has a maturity of seven years, a coupon of 0.5% and is rated BBB+ by S&P. The re-offer spread was set at €mid-swap plus 95 basis points, which represents the tightest spread to mid-swap in the EUR market compared to any precedent debt IPO in the real estate fund space.
The order book reached more than €1.7 billion from over 100 orders and was oversubscribed by 3.4x. Over 93% of the deal was allocated to high quality European ‘buy and hold’ accounts with the majority of the bond allocated to asset managers and insurance companies.
To align with CBRE Global Investors’ ESG ambitions and that of the Fund, the bond has been structured as a Green Bond. The Fund will allocate 100% of the net proceeds from the issuance of each Green instrument (loan or bond or any other financing instrument) to green projects (“Eligible Green Projects”) satisfying one or more of the eligible indicators and performance requirements. The Green Bond framework has been assessed and approved for accuracy and integrity by Sustainalytics, acting as SPO (“Second Party Opinion”) provider.
Duco Mook, Head of Treasury & Debt Financing, CBRE Global Investors commented: “We are delighted to have achieved such an excellent outcome for our first bond issuance in Europe. The majority of the investors that we engaged with have placed orders, which is testament to the strength of the fund’s credit and market backdrop.
It was not surprising to see that our Green Finance Framework was of particular interest to investors. With an increasing demand for green loans from long-term investors, it was always a requirement for this issuance. This aligns with our ESG ambitions and net-zero targets both at a fund and corporate level.“
Goldman Sachs acted as Global Coordinator and sole Bookrunner to CBRE Global Investors.
