Mindspace Business Parks REIT (Mindspace REIT) has successfully raised Rs 650 crore (6.5 billion) from the International Finance Corporation (IFC), the private sector arm of the World Bank Group, through a Sustainability Linked Bond Issuance.
The bond's coupon is tied to Mindspace REIT's commitment to achieving specific Environmental, Social, and Governance (ESG) targets aimed at fostering a greener ecosystem. This issuance follows the company's maiden green bond issue in March 2023. With this latest round, Mindspace REIT's total green and sustainability-linked financing now amounts to Rs 18.6 billion, reinforcing its dedication to responsible growth, according to CEO Ramesh Nair.
The bonds, issued with a tenure of seven years, have been rated [ICRA] AAA(Stable) by ICRA. Shardul Amarchand Mangaldas & Co served as the legal counsel for the issuer in this transaction.
Wendy Werner, IFC Country Head for India, commented on the partnership, stating, "This aligns with India's net-zero ambitions and demonstrates the viability 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."
Mindspace REIT has set specific ESG targets crucial to its operations, including reducing greenhouse gas emissions (Scope 1, 2, and 3), increasing the share of green-certified areas for existing buildings (under operations and maintenance), and reducing energy intensity.
The bond's coupon is fixed in nature but will be gradually reduced based on the achievement of these targets. The company has established its maiden sustainability-linked financing framework, allowing Mindspace REIT and its special purpose vehicles (SPVs) to issue sustainability-linked instruments.
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