CPI Property Group has issued green bonds with a face value of €750 million, a yield of 1.625% and a maturity date of 23rd April 2027. Over €2 billion of the bonds have been placed. The company intends to use a significant portion of this to acquire high-quality office properties in Warsaw during Q4 2019 and 2020.
“We are proud to be the first company from our region to issue a benchmark Euro-denominated green bond,” said Martin Nemecek, CEO. “The strong demand and attractive pricing received from the market demonstrate investors’ continued confidence in CPIPG’s strategy and management team.”
Investor demand for the new issue peaked at more than €2 billion, following a two-day marketing exercise in London and Paris. The UK represented 38% of the orderbook, with strong interest from Germany, Austria (18%) and France (17%). Investors from the rest of continental Europe and Asia also participated. Fund managers accounted for 77% of demand followed by insurance companies, pension funds and banks. Including proceeds from the green bond issuance, CPIPG’s total liquidity (in the form of cash and revolving credit facilities) exceeds €2 billion. The company intends to use a significant portion of this to acquire high-quality office properties in Central Warsaw during Q4 2019 and 2020.
Green bonds are used to fund projects which have a positive impact on the environment. Investor demand for green bonds has soared to new records, with over US$200 billion issued in 2019. CPIPG has developed a green bond framework under which the company has committed to using proceeds from green bonds to finance and/or refinance existing and/or future projects which improve the environmental performance of CPIPG’s property portfolio and contribute to the Company’s climate impact mitigation objectives. The framework defines eligibility criteria according to four types of green assets/initiatives: certified green buildings, energy efficiency projects, renewable energy and the promotion of sustainable farming. The framework has a second party opinion provided by Sustainalytics.
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