Standard Bank loan agreement marks another first for Equites in South Africa

CFO Laila Razack says the loan forms part of Equites’ focus to becoming a globally relevant REIT.

Equites Property Fund has concluded a R2 billion debt, refinance and upsize package with Standard Bank.

The loan marks another first for Equites, as it is the first pound sterling (GBP) denominated sustainability-linked loan in the South African REIT sector, and the first GBP denominated loan in South Africa with sustainability-linked features.

In October, Equites also concluded the first green loan in the sub-Saharan African real estate sector, with RMB acting as the sole arranger and sustainability agent for a R225 million green loan.

The package comprises a R800 million three-year sustainability-linked unsecured bond, a £50 million (about R1.02 billion) two-year sustainability-linked loan, including a £25 million upsize (about R510 million), and a R221 million three-year loan.

The environmental, social, and governance (ESG) commitments under the facilities are focused on sustainable building practices, increasing renewable energy usage, and promoting supplier enterprise development.

According to Equites, the company has committed to ensuring that all its new developments are green certified, that renewable energy consumption across its portfolio of high-grade logistics assets is increased each year, and to increasing its investment with enterprise and supplier development partners as part of Equites’ Ampcore programme.

Each KPI has two sustainability performance targets linking Equites’ all-in cost of debt to their performance in achieving material improvements in the various areas of the business. These initiatives are aligned with Equites’ strategy to ensure the sustainability of its portfolio and the environment in which it operates.

“As part of our focus on becoming a globally relevant REIT, Equites is dedicated to offering our tenants high-quality logistics assets built to extracting green standards and in assisting our tenants in their move towards renewable energy, with all renewable energy generated provided to the tenant at no cost,” said Equites CFO Laila Razack.

“The inclusion of a KPI that demonstrates our commitment to the social fabric of South Africa through the promotion of our Ampcore programme is clear evidence of the responsibility Equites has undertaken to the sustainable upliftment of black-owned SMMEs,” she added.