Aldar inks deal with HSBC to secure $81.67mn sustainability-linked loan – MEP MiddleEast

Aldar inks deal with HSBC to secure $81.67mn sustainability-linked loan – MEP MiddleEast

Aldar Properties has inked an $81.67mn (AED300mn) facility with HSBC that links the interest margin payable under the facility to achievement of sustainability targets. The agreement sees Aldar become the first real estate company in the Middle East and North Africa (MENA) region to enter into this type of financing.

The five-year term sustainability-linked loan includes a mechanism to adjust Aldar’s interest margin annually in line with achievement of targets on energy and water intensity, waste recycling, and worker welfare.

These targets, which are aligned with Aldar’s sustainability strategy, were identified to be material to both Aldar and the wider real estate sector.

As part of the agreement, Aldar has also committed to investing a fixed amount in one or more qualifying environmental, social and governance (ESG) projects, if it does not reach agreed annual targets.

The transaction is structured in alignment with the Sustainability-Linked Loan Principles (SLLP) published by the Loan Market Association (LMA), Asia Pacific Loan Market Association (APLMA), and Loan Syndications & Trading Association (LSTA). The loan will be used for general corporate purposes, including the roll-out of ESG initiatives across the group. 

The group chief financial and sustainability officer at Aldar, Greg Fewer, said: “Aldar is deeply committed to