Singapore’s GIC Helps Fund Construction Of Sydney Office Bldg
AUSTRALIA – Singapore sovereign wealth fund GIC has agreed to be a major investor in a A$700 million green loan that will be used for the construction of Parkline Place, a 39-storey office tower in central Sydney, reported The Australian Financial Review on Wednesday (8 December, SGT).
The green debt facility has been issued to project owners – Investa, Mitsubishi Estate, and Oxford Properties Group – via Gresham Property’s recently closed construction debt fund, GPF No. 8, which has raised over A$1.4 billion.
Gresham Property thinks it is the biggest single-source construction loan in the country. “We’re not aware of any larger single-lender loan in Australia,” said Mike Burley, Joint Managing Director of Gresham Property.
Ami Simon, a Joint Managing Director at Gresham Property, explained that the debt facility qualifies as a green loan” because of the eco-friendly attributes of Parkline Place, which is targeting to meet a 5.5-star NABERS Energy rating.
“The loan itself complies with the globally recognised guidelines for green loans, the Green Loan Principles, and reflects the Green Financing Framework adopted by Oxford and Investa.”
Notably, borrowers of green loans are required to submit reports on where they utilised the debt proceeds, including quantitative performance measures & qualitative performance indicators.
By investing in the loan, GIC shows that it is supporting the construction of sustainable office buildings, with its Chief Investment Officer of real estate Lee Kok Sun revealing that the sovereign wealth fund has been increasingly searching for environmentally sustainable developments to invest in.
“As a long-term investor, sustainability is integral to GIC’s mandate and continues to be a key priority for us in real estate, we find that tenants globally have an increasing preference for environmentally sustainable buildings.”
“We are confident that the design of Parkline Place caters to modern tenant demands and will generate resilient returns in the long run,” noted Lee.
Green loans are on the rise in Australia. Three weeks ago, Charter Hall disclosed that it had sourced a A$500 million sustainability-linked loan for the Charter Hall Office Trust (CHOT) via Sumitomo Mitsui Banking Corporation and MUFG.
Construction of Parkline Place is ongoing and the office building is targeted to be completed by 2024.