SHKP signs first sustainability-linked loan of HK$8,650 million, the largest of its kind in real estate sector in Hong Kong
Sun Hung Kai Properties Limited (SHKP) today signed its first sustainability-linked loan (SLL) facility with oversubscription from eight leading international and local banks, amounting to HK$8,650 million. The four-year club loan, the largest for the real estate sector in Hong Kong, reaffirms the Group’s commitment to sustainability for pursuing long-term growth.
The credit facility received an overwhelming response from banks, with the loan size having increased significantly from an initial amount of HK$3,000 million to HK$8,650 million, clearly showing the banking community’s strong support for the Group’s sustainability initiatives.
SHKP has been incorporating elements of green and wellness in its operations to create sustainable value for its stakeholders. Apart from developing a number of certified green commercial landmarks in Hong Kong and major mainland cities, the Group strives for a balance between development and environmental conservation as evidenced by its residential developments, such as PARK YOHO and Wetland Seasons Park. To help combat climate change, SHKP has established clear environmental targets and consistently reviews its completed properties for investment, looking for areas of environmental performance enhancements. The Group is planning to install solar panels at its new buildings, where feasible, as well as promoting a wider use of electric vehicles in the community by installing more charging stations at its new developments.
SHKP’s dedicated work on Environmental, Social and Governance (ESG) is well recognized by respected organizations and the financial community. The Group has been named one of the top three companies in the Hang Seng Corporate Sustainability Index for three consecutive years, and a constituent member of the FTSE4Good Global Index since 2018.
SHKP Chairman and Managing Director Raymond Kwok said: “This credit facility marks another milestone on SHKP’s sustainability journey, giving us new momentum to create long-term value for stakeholders and the community as a whole. It demonstrates the Group’s ongoing efforts on ESG and will reinforce our Building Homes with Heart belief in making the earth and our community a better home for all. The Group is committed to not just meeting the sustainability performance targets but also developing comfortable, green and sustainable communities for cross-generational living, working, and enjoyment.”
Bank of China (Hong Kong) Limited, DBS Bank Ltd., The Hongkong & Shanghai Banking Corporation Limited collectively act as sustainability advisors of this facility and advise SHKP on sustainability performance targets. On top of the three advisors, the facility is also backed by Mizuho Bank, Ltd., MUFG Bank, Ltd., Agricultural Bank of China Limited, Sumitomo Mitsui Banking Corporation, and Hang Seng Bank Limited.
Bank of China (Hong Kong) Limited’s (BOCHK) Deputy Chief Executive Wang Bing said: “SHKP has been upholding Building Homes with Heart at its core and is fully devoted to driving sustainable development across its diversified business segments. BOCHK is very delighted to be appointed as the sustainability advisor for its sustainability-linked loan facility. With green and sustainable development as one of our core strategic goals, the bank strives to diversify our portfolio of green finance products and services. As one of the major commercial banks, we are committed to promoting the development of green and sustainable finance in Hong Kong. We will continue to support our clients through low-carbon transition so as to contribute to a more sustainable future together.”
DBS Hong Kong’s Managing Director and Head of Institutional Banking Group Alex Cheung said: “DBS Bank has a long-standing relationship with SHKP through supporting their various key financing exercises over the years. We are pleased to participate in their first sustainability-linked loan as their sustainability advisor. As our clients advance on their sustainability agenda, DBS Hong Kong will double down on our commitment to collectively realizing a greener and more sustainable future with our partners.”
The Hongkong & Shanghai Banking Corporation Limited’s Managing Director, ESG Solutions, Global Banking Jonathan Drew said: “SHKP is implementing energy efficiency solutions across its portfolio and thus playing its part to implement a critical component in Hong Kong’s Climate Action Plan 2050. This loan incentivises SHKP to meet its ambitious targets and at the same time demonstrates the potential of Hong Kong’s fast growing green and sustainable finance market. We are delighted to support SHKP in this landmark transaction.”
According to the loan agreement, SHKP is entitled to interest savings upon achieving a set of predetermined sustainability ESG targets. These sustainability performance targets include:
- Achieving annual reduction in electricity consumption intensity (ECI, measured in units of kWh/m2)
- Demonstrating continuous improvements in the S&P Global ESG Scores(1)
- Retaining as a constituent member of the Hang Seng Corporate Sustainability Index with a designated rating(2)
The facility was signed by Sun Hung Kai Properties (Financial Services) Limited, with its parent, SHKP, providing a guarantee. It has a 30:70 split between a term loan and revolving credit tranches and a maturity of four years. The proceeds will be used for general working capital and to fund ongoing sustainability initiatives. SHKP has the highest credit ratings among property companies in Hong Kong, attaining an A1 and A+ rating with stable outlook from Moody’s and Standard & Poor’s respectively.
(1) The S&P Global ESG Scores (formerly known as the SAM ESG Scores; Dow Jones Sustainability Index scores) is an ESG data set that provides company level, dimension level, and criteria level scores based on the S&P Global Corporate Sustainability Assessment process, an annual evaluation of companies' sustainability practices.
(2) The Hang Seng Corporate Sustainability Index includes the top 30 Hong Kong-listed companies that perform well on corporate sustainability. Constituent companies of the index are selected by the Hong Kong Quality Assurance Agency, an independent and professional assessment body, to ensure the index is objective and reliable. SHKP attained AAA, the highest rating, in both 2020 and 2021.
- Email email@example.com