Redefine claims second green bond issued by a SA REIT

Redefine's exco

Front from Left – Olaf Schmidt, Investment manager (IFC); Anelisa Keke, Chief sustainability officer (Redefine); Andrew Konig, Chief executive officer (Redefine)

Back from left – Lesley Baerveldt, Head of corporate finance (Redefine); Ejiro O. Agbeyi, Investment officer (IFC); Ken Osei, Principal investment officer (IFC); Ntobeko Nyawo, Chief financial officer (Redefine)

Redefine Properties and the International Finance Corporation (IFC) have announced the issuance of a green bond, with IFC as the anchor investor. Redefine’s first, the green bond was oversubscribed and raised R1.5 billion.

IFC will invest up to R750 million in the bond to assist Redefine in reducing energy and water consumption and make other positive environmental improvements in its commercial property portfolio.

According to Forbes, the real estate sector is estimated to generate about 40% of the world’s CO2 emissions. Redefine, South Africa’s second largest REIT, will use the green bond to support the long-term decarbonisation of its buildings which house more than 4 000 tenants and employ more than 195 000 people.

This green bond diversifies our funding portfolio and amplifies our commitment to placing ESG at the heart of what we do,” said Ntobeko Nyawo, Redefine’s Chief Financial Officer. “Redefine will use the proceeds of this bond to finance only highly-rated green buildings, which is firmly in line with the company’s over-arching, long-term climate-resilient framework.”

The green bond, the second issued by a REIT in South Africa, aligns with Redefine’s sustainability goals to transform its properties into environmentally sustainable and resource efficient assets. The company has established a long-term target to achieve net zero carbon status by 2050.

The green bond also aligns with the International Capital Market Association Green Bond Principles. It was listed on the Johannesburg Stock Exchange (JSE) in the Sustainability Segment, a platform for companies to raise debt for green, social, and sustainable initiatives.

IFC’s investment will be used exclusively to refinance existing green buildings with a Green Star 4 category certification, which is a tool used to rate the environmental impact of buildings, as defined by the Green Building Council of South Africa or the equivalent.