GuocoLand Limited, through its indirect subsidiaries, MTG Apartments Pte Ltd and MTG Retail Pte Ltd, is building a new luxury residential cum commercial development at Tan Quee Lan Street, Singapore, and has secured a S$730 million green club loan for the project from OCBC Bank, DBS Bank and ICBC Singapore Branch. The development is a joint venture between GuocoLand and two subsidiaries of Hong Leong Holdings – Intrepid Investments Pte Ltd and Hong Realty (Private) Limited.
In its announcement, GuocoLand said this is its first green loan and currently the industry’s largest green loan for a development project in Singapore. Proceeds from the loan will go towards financing the project, including the efforts in sustainable development, water and energy conservation, and adoption of immersive urban greenery and landscaping.
The new 30-storey residential cum commercial development at Tan Quee Lan Street will be located right above the Bugis mass rapid transit (MRT) interchange station. It will have two residential towers with more than 500 units of luxury apartments as well as a retail podium with food and beverage establishments open to the public.
The joint venture was awarded the tender for the 124,116 sq ft land plot in September 2019 with their bid of S$800.2 million. The new development is expected to meet the criteria to receive Green Mark GoldPLUS certification by the Building and Construction Authority (BCA).
GuocoLand, together with OCBC Bank acting as the sole green financing advisor, developed a green loan framework that provides guidance for the evaluation of the new residential cum commercial development’s eligibility as a green project based on its sustainability objectives, as well as the management of the loan proceeds.
The green loan framework has been structured in accordance with the Green Loan Principles issued in 2018 by the Loan Market Association and Asia Pacific Loan Market Association. DBS Bank and OCBC Bank are joint green coordinators and, together with ICBC Singapore Branch, are mandated lead arrangers.
GuocoLand has long championed environmental best practices in the built environment. The green loan reinforces GuocoLand’s continued commitment to sustainable development with the Tan Quee Lan Street site expanding its portfolio of environment-friendly developments in Singapore.
“Climate change is one of the biggest challenge of our times. Our developments are always conceived, developed and managed with sustainability principles as the foundation,” said Cheng Hsing Yao, group managing director of GuocoLand Singapore. “We were one of the first real estate developers to receive the BCA Green Mark Platinum award, and Guoco Tower was one of the earliest integrated developments in Singapore to receive both Green Mark Platinum and LEED Platinum Certifications.
“Our latest projects, Guoco Midtown and Midtown Bay, have been awarded the BCA Green Mark Platinum award this year and we are proud to continue developing buildings that are grounded on sustainability principles in the future, including this new development at Tan Quee Lan Street.”
According to Elaine Lam, head of global corporate banking at OCBC Bank, green financing has taken off in Singapore since late 2018, with the majority of the funds being channelled into greening the property sector. “Having an industry leader like GuocoLand come in to keep this momentum going is crucial. For OCBC, we are committed to creating sustainable value for the community we operate in and to maintaining a sustainable environment for future generations. We will continue to work towards our goal of a S$10 billion sustainable finance portfolio by 2022.”
Chew Chong Lim, managing director and global head of real estate for Institutional Banking Group at DBS Bank added, “GuocoLand’s first green loan and the largest for a development project, is a significant milestone for the real estate industry that is seeing an increasing number of companies incorporating sustainability practices into their corporate strategies and building management. Responsible banking is one of the key tenets of DBS’ sustainability commitment and we want to support more companies like GuocoLand that are making positive environmental impact even in these challenging times, to advance sustainable business practices.”
Geng Hao, deputy general manager of ICBC Singapore Branch also commented, “As part of ICBC's consistent green strategy, we are very pleased to accompany GuocoLand on its sustainable journey for its largest green loan for a development project in Singapore. We have social and environmental commitments to provide financial support to GuocoLand and more companies in their green transformation, and make new contributions to sustainable development in Singapore.”