OUE REIT Management Pte. Ltd., managing OUE Real Estate Investment Trust (OUE REIT), has announced the successful acquisition of its first green loan, a S$600m facility, alongside S$225m in revolving credit and a S$5m bank guarantee. This financing, secured through a joint venture with OUE Allianz Bayfront LLP, aims to refinance existing facilities due in 2026 and support general corporate purposes. The green loan, coordinated by DBS Bank Ltd. and Oversea-Chinese Banking Corporation Limited, follows OUE Bayfront’s upgrade to a BCA Green Mark Platinum certification.
The refinancing will lower the weighted average cost of debt to 4.1% per annum by 30 June 2025, down from 4.2%, and extend the average debt term from 2.7 to 2.9 years. Only 22.5% of OUE REIT’s total debt will be due in 2026 post-refinancing. CEO Han Khim Siew highlighted the strategic advantage, stating, “This timely refinancing allows OUE REIT to capitalise on our green credentials and the recent decline in the Singapore Overnight Rate Average to achieve significant interest cost savings.”
The transaction marks a significant step in OUE REIT’s sustainability journey, with green and sustainability-linked financing now comprising 86.1% of its total borrowings. Elaine Lam of OCBC emphasised the importance of this milestone, noting, “This milestone attests to OUE REIT’s commitment as a forward-looking REIT to continually set new benchmarks in sustainable building practices.”
This refinancing not only optimises borrowing costs but also aligns with OUE REIT’s broader sustainability goals, setting a precedent for future financial strategies.
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