British property investment firm Segro has announced that it is launching its own 10-year €500m senior unsecured green bond.
The bond, according to a statement from the company, is priced at 55 basis points above euro mid-swaps and has an annual coupon of 0.5%. The company said the bond had been eight times oversubscribed.
Soumen Das, chief financial officer of Segro, said: “We are delighted with the support for Segro’s first Green and first euro-denominated bond issue, achieving a 0.5% coupon and 10-year maturity. The level of oversubscription we received for the issuance underlines investors’ recognition of the strength of our business and the importance they rightly place on sustainable investment. The proceeds will be invested in line with our Responsible Segro framework including the construction of new properties with high sustainability credentials through our very active development programme.”
Segro is one of the latest companies to get in on the current craze for green bonds. According to the Climate Bonds Initiative, in its Sustainable Debt: Global State of the Market 2020 report, the value of the green bonds market shot up 9% between 2019 and 2020. And, at the end of last year, the size of the market went over $1tn for the first time since its inception in 2007.
Other companies moving into the green space include Munich Re, which announced at the end of last month that it was to issue its own €1.25bn green bond, and fund manager GAM who said it was developing a strategy to target green and sustainability bonds issued by European financials. The UK government is also believed to be developing its own ‘green gilt’, which has been predicted to launch in the final quarter of this year.
Much of the current shift towards green bonds and the growth of the market has led to some questioning about ‘greenwashing’ in this space. That noise has become so noticeable that the EU released its own briefing document, European Green Bonds Regulation, in July to address the issue, while the UK government set up the Green Technical Advisory Group earlier this year.