Aldar Investment Properties raises $500mn via inaugural green sukuk

Aldar Investment Properties raises $500mn via inaugural green sukuk

Aldar Investment Properties (AIP), the largest real estate management company in Abu Dhabi and subsidiary of Aldar Properties PJSC (Aldar), has successfully raised $500 million through an inaugural green sukuk.

The 10-year sukuk was priced with a 4.875 percent coupon rate and is amongst the highest price tightening of any corporate issuance in 2023. The effective funding cost for AIP will be significantly lower due to a successful pre-hedging strategy implemented in 2021 and 2022 when long term rates were materially lower.

As a result, the forward starting swaps secured will reduce the issuance’s effective rate to 3.85 percent. Following a global investor roadshow, the issuance was four times oversubscribed, attracting a range of local, regional, and international investors that placed total orders of over $2.3 billion.

Green Finance Framework

The issuance forms part of a $2 billion financing program by AIP to support its growth agenda and sustainability commitments, in line with the goals of the Paris Agreement, the UAE Net Zero by 2050 Strategic Initiative and Aldar’s plan to be a net zero carbon business by 2050.

The sukuk proceeds will be deployed in accordance with Aldar’s Green Finance Framework, which governs investment in sustainable projects such as green buildings, property upgrades to