AXA IM Alts Friday announced its European open-ended real estate fund AXA CoRE Europe has priced a second green bond with a €500 million issuance.
The Green Bond has an eight and a half year maturity and is the first to be issued under a new €3 billion euro medium-term note (EMTN) programme which AXA IM Alts has created on behalf of AXA Core Europe to facilitate further issuances.
The Green Bond was 4.6 times oversubscribed, attracting a €2.3 million orderbook, with the Green Notes placed across a broad range of c. 167 European and international institutional investors. Maturing in April 2030, the Green Notes pay a coupon of 1.25% and have an issue price of 99.292%. This offering follows AXA CoRE Europe’s inaugural €500 million green bond, which launched last June. As with the first green bond, the Green Notes have been assigned a BBB+ investment grade rating by S&P Global ratings.
”The majority of the proceeds from the Green Bond will be used to refinance existing secured debt, with the balance invested in suitable assets from AXA CoRE Europe’s acquisition pipeline. The Green Notes improve the capital structure of the fund by increasing the unsecured debt portion up to c.60% of the total debt, while maintaining a low rate of net leverage at c.25%,” said the company in a press release.
Goldman Sachs International acted as Sole Global Coordinator, Joint-Bookrunner and sole green structurer on the transaction. Société Générale and Crédit Agricole CIB acted as Joint-Bookrunners.
The Green Bond was issued under AXA Core Europe’s Green Finance Framework which has been approved by Sustainalytics, a market leading independent ESG and corporate governance research, ratings and analytics firm, which confirmed its alignment with the ICMA Green Bond Principles.
Timothé Rauly, Global Head of Fund Management at AXA IM Alts, commented: “This second green bond issuance on behalf of AXA CoRE Europe is a further endorsement of the quality of assets in the fund’s portfolio, as well as a clear testament to both our strong track record in ESG investing and the continued demand for green investment opportunities from institutions. This issuance extends the Fund’s average debt maturity, further diversifies the sources of financing and, more importantly, significantly reduces the level of secured debt within the portfolio. It will facilitate the further growth of the fund and help us achieve our goal of delivering market leading returns to our clients while pursuing investment strategies that affect positive change in society.”