Mindspace Business Parks REIT has successfully raised Rs 650 crore (6.5 billion) from the International Finance Corporation (IFC). IFC is the private sector arm of the World Bank Group, and the funds were raised through Sustainability Linked Bond Issuance. The coupon of the bond is linked to the company’s commitment to achieve certain ESG (Environmental, Social, and Governance) targets, demonstrating the company’s dedication to creating a greener eco-system.
Continuing the Sustainable Growth: Ramesh Nair, CEO of Mindspace REIT, expressed his satisfaction with the latest fundraising, stating, “This follows our maiden green bond issue in March 2023. Post this issuance, our cumulative green/sustainability linked financing now stands at Rs 18.6 billion, strengthening our commitment to responsible growth.” It highlights the company’s focus on sustainable practices and responsible business operations.
Diversifying Revenue through Bonds: The bonds issued by Mindspace REIT have a tenure of seven years and have been rated ICRA AAAStable by ICRA. The company’s decision to engage in sustainability-linked financing demonstrates its commitment to reduce GHG (Greenhouse Gas) emissions, increase the share of green certified area for existing buildings, and reduce energy intensity.
Supporting India’s Net-Zero Ambitions: Wendy Werner, IFC Country Head for India, emphasized the partnership’s alignment with India’s net-zero ambitions. It showcases the benefits of climate finance in the real estate sector. “Our support aims to attract more diverse and long-term funding at a time when private capital is critical to building a greener, more resilient future,” said Wendy Werner. The collaboration between Mindspace REIT and IFC is significant in driving sustainable development in the real estate sector.
Maiden Sustainability-Linked Financing Framework: Mindspace REIT has established its maiden sustainability-linked financing framework within its operations. Under this framework, the company, along with its Special Purpose Vehicles (SPVs), can undertake issuances of sustainability-linked instruments. These instruments allow the coupon of the bonds to be fixed and stepped down based on the achievement of predetermined targets. This approach further incentivizes the company’s commitment to its ESG agenda and promotes responsible business practices. In conclusion, Mindspace REIT’s successful fundraising of Rs 650 crore from the International Finance Corporation marks another milestone in its sustainable journey. The partnership’s alignment with India’s net-zero ambitions exemplifies the role of private capital in enabling a greener and more resilient future. Going forward, Mindspace REIT remains dedicated to its ESG targets and responsible growth that contributes to a sustainable ecosystem.
