ESR and Chinachem Close Hong Kong's First-ever HK$8.8 billion Green Loan for the Development of a Logistics Centre
ESR Group Limited (“ESR” or the “Company”, together with its subsidiaries as the “Group”; SEHK Stock Code: 1821), APAC’s largest real asset manager powered by the New Economy, and Chinachem Group have closed Hong Kong’s first-ever Green Loan for the development of a logistics centre. The HK$8.8 billion Green Loan is one of the biggest in Hong Kong in 2023 and it will be used to finance the construction of Kwai Chung Cold Storage Logistics Centre, Hong Kong’s largest cold storage facility ever to be built in the last 20 years.
This five-year committed Green Loan is in alignment with the Green Loan Principles issued by the Loan Market Association, Asia Pacific Loan Market Association and Loan Syndications & Trading Association. The Green Loan Principles focus on the following four core components (1) use of proceeds; (2) process for project evaluation and selection; (3) management of proceeds; and (4) reporting.
In support of efforts of ESR and Chinachem Group to further strengthen their Environmental, Social and Governance (“ESG”) commitments, Sumitomo Mitsui Banking Corporation (“SMBC”), United Overseas Bank Limited (“UOB”) and Oversea-Chinese Banking Corporation Limited (“OCBC”) acted as Mandated Lead Arrangers, Bookrunners and Underwriters and Green Loan Coordinators. Industrial and Commercial Bank of China (Asia) Limited (“ICBC Asia”), The Bank of East Asia, Limited (“BEA”), and The Bank of East Asia, Limited, Singapore Branch acted as Mandated Lead Arrangers and Bookrunners. Other Mandated Lead Arrangers included China CITIC Bank International Limited (“CNCBI”). Allen & Overy acted as the lead counsel to ESR and Chinachem Group and Mayer Brown acted as the lead counsel to the lenders.
Stuart Gibson and Jeffrey Shen, ESR Group Co-founders and Co-CEOs, said: “In a market with tight liquidity, we are extremely proud of this achievement. We thank our partners for their strong support of our ESG commitment, as well as development and project management capabilities, which are in line with the Hong Kong Government’s focus on sustainable modern logistics development to promote the city’s status as an international trade centre. Our cold storage logistics centre in Kwai Chung will provide a range of green features for companies looking for sustainable solutions in all aspects of their supply chain.”
“We’re thrilled to partner with various financial institutions to finance the development and construction of Kwai Chung Cold Storage Logistics Centre. The Green Loan advances our shared ESG priorities while also aligning with our commitment to the balance of People, Prosperity, and Planet,” says Donald Choi, Executive Director and CEO of Chinachem Group. “Together with ESR, our ambition is to shape the future of Hong Kong's logistics sector by creating a legacy of sustainable development and prosperity.”
Kwai Chung Cold Storage Logistics Centre targets to achieve Green Building Certifications such as BEAM Plus New Building Platinum and LEED Gold. 30% of the site area will be designated for greenery, including a rooftop garden and there will be a recycling irrigation water system for the landscape area. Electric Vehicle (EV) charging points will also be installed at the carpark.