Ivanhoé-Backed London Resi Fund Secures £465M Sustainability-Linked Loan
Residential investment vehicle Prime London Ventures has secured a £465M sustainability-linked loan from UK bank HSBC and Singaporean lender OCBC Bank to refinance its £1B portfolio of residential assets in central London, according to Real Estate Capital Europe.
The five-year facility includes a revolving credit facility for capital expenditure and has been secured by a portfolio of hundreds of upmarket London rented apartments, including 21 apartments overlooking Regent’s Park, 65 units in Mayfair and homes in the Bayswater area.
Prime London Ventures, a vehicle owned by Ivanhoé Cambridge and London landlord Residential Land, has agreed as part of the loan to upgrade energy performance certificates and reduce carbon emissions across its properties.
HSBC UK acted as the sole sustainability-linked loan coordinator, and the sustainability targets include a commitment to reducing Scope 3 emissions.
“For more than 10 years, we have worked closely to align the sustainability goals of our respective organisation,” Residential Land Chief Financial Officer Jonathan Rust told Real Estate Capital Europe. “We are committed to our target programme of carbon emission reduction and we, along with our tenants, are already seeing the positive impact of these initiatives.”
Although growing in popularity, sustainability-linked loans have come under some scrutiny in recent months. Their aim is to support sustainable economic activity and growth, with interest rates linked to meeting certain agreed sustainability goals.
However, earlier this year the Financial Conduct Authority published a short report that said that a more prescriptive framework would improve market integrity and reduce the threat of greenwashing accusations, including through the use of science-based targets.
It said that several banks were advocating for uniform disclosure and independent monitoring and verification of targets, which could include disclosed targets aligned to borrowers’ published transition plans.
Based in St. James’s, Prime London Ventures was established by Residential Land, Ivanhoé Cambridge and U.S. opportunity fund Apollo Global Management in 2018 and specialises in providing access to high-end London property and associated services to high net worth individuals, consortiums, corporations developers and funds. The trio first teamed up to invest in high-end rented apartments in London in 2012.
It focuses on the West End, Midtown, Docklands and the City, plus other affluent London neighbourhoods, sourcing properties from £5M to £500M, according to the company’s website. About £300M of the portfolio is up for sale.
