Green Finance

Regarding Green Finance

Green finance is a term used to denote bonds (green bonds) and borrowings (green loans) with restrictions on the use of proceeds for business activities that take into consideration the environment.

NTT UD REIT Investment Corporation (“NUD”) and its asset manager NTT Urban Development Asset Management Corporation aim to realize CSR through their operations based on the CSR vision stipulated by NTT Urban Solutions. Moreover, in view of prioritizing the interests of investors in the medium to long term, NUD and its asset manager have recognized the importance of ESG considerations and have formulated a sustainability policy for real estate investment management operations in general in order to incorporate ESG considerations, promoting specific initiatives that care for the environment and society.

sustainability policy PDF

Green Finance Framework

In order to ensure that the proceeds are used solely for projects with positive environmental impact, NUD has established the following green finance framework (“Framework”) and procures and manages the proceeds in accordance with this Framework.

Third-Party Evaluation

In order to make sure that the Framework is in compliance with (1) the Green Bond Principle 2018 established by the International Capital Market Association (ICMA), (2) the Green Loan Principles 2020 established by the Loan Market Association (LMA) and others, (3) the Green Bond Guidelines 2020 established by the Ministry of the Environment of Japan and (4) the Green Loan and Sustainability Linked Loan Guidelines 2020, NUD had the Framework evaluated by a third-party institution, the Japan Credit Rating Agency, Ltd. (“JCR”), and received the highest status of “Green 1 (F)” in the JCR Green Finance Framework Evaluation.

JCR Green Finance Framework Evaluation

Use of Proceeds

NUD designates two targets for the use of proceeds from the Framework, namely green buildings with a certain certification standard and properties with a certain level of energy-saving capabilities. For details, please see “Eligibility Criteria.”

Eligibility Criteria

The green eligible assets are selected from assets which meet the standards of either 1 or 2 below.

1. Green Buildings

Properties that have acquired or are scheduled to acquire certification from either of the following third-party institutions

  • (1) 3 to 5 stars of the DBJ Green Building Certification
  • (2) B+ to S rank of CASBEE for Buildings (New Construction/Existing Buildings/Renovation) or CASBEE Real Estate Certification
  • (3) 3 to 5 stars of BELS Certification
  • (4) Silver to Platinum rank of LEED Certification

※ Properties for which BOMA360 Performance Program (BOMA360) is acquired are included, assuming acquisition of the above certifications.

2. Energy-Saving Functions

Properties with an energy reduction rate (ERR) of 30% or more.

Management of Proceeds

Proceeds from green finance are scheduled to be allotted to funds for the acquisition of green eligible assets or to refinancing of said assets promptly after procurement of the proceeds or at an otherwise early stage. The proceeds will be managed as cash or cash equivalents until their allotment is determined.

With regard to the management of the balance during the period prior to redemption or repayment of green finance and unallocated proceeds in case of sale of asset targeted for use of proceeds or temporary unallocated proceeds generated due to damage, etc., portfolio management (a method of management in which it is confirmed in each fiscal period that the total green finance balance does not exceed the upper limit of green eligible liabilities (total acquisition price of assets satisfying eligibility criteria multiplied by total assets LTV)) will be applied.

Reporting

The status of fund appropriations procured through green finance will be updated yearly as long as the balance remains.

(1)Reporting on the Status of Fund Appropriations

The status of fund appropriations procured through green finance will be disclosed and updated yearly on NUD’s website as long as the balance remains.

Status of Fund Appropriations from Green Bonds

As of April 30, 2021

Name Issuance date Redemption date Total issuance amount
(million yen)
Allocated amount
(million yen)
Unallocated amount
(million yen)
Use of proceeds
The 9th Unsecured Investment Corporation Bonds (green bonds) 2021/04/27 2024/04/26 2,000 2,000 0 Repayment of loans (Otemachi Financial City Grand Cube, Urbannet Shizuoka Ote-machi Building and Urbannet Shizuoka Building) (Including loans for subsequent refinancing)
The 10th Unsecured Investment Corporation Bonds (green bonds) 2021/04/27 2031/04/25 3,200 3,200 0 Repayment of loans (Otemachi Financial City Grand Cube, Urbannet Shizuoka Ote-machi Building and Urbannet Shizuoka Building) (Including loans for subsequent refinancing)

Green Loan Allocation Status

As of April 30, 2021

Lender Loan date Repayment date Loan amount
(million yen)
Allocated amount
(million yen)
Unallocated amount
(million yen)
Use of proceeds
- - - - - - -

(2)Balance of Proceeds from Green Finance

The total acquisition price of green eligible assets (“total of green eligible assets”), green eligible liabilities and balance of proceeds from green finance will be reported annually as long as there is a balance of funds procured as green finance.

As of April 30, 2021

Property name Acquisition price
(million yen)
Total floor space
(㎡)
DBJ Green Building Certification CASBEE for Buildings (New Construction / Existing Buildings / Renovation) CASBEE Real Estate Certification BELS Certification Energy-saving capabilities (ERR of 30% or more)
Landic Shimbashi Building 6,341 6,914.84 - - A - -
Landic Shimbashi 2 Building 7,045 8,332.65 - - A - -
Takadanobaba Center Building 5,118 9,906.83 - - A - -
Urbannet Azabu Building 5,000 6,486.42 - - A - -
Granpark 11,490 160,042.88 - - S - -
Otemachi Financial City Grand Cube 4,680 206,107.08 - - - - Relevant
Shinagawa Season Terrace 18,720 202,666.94 - - - ★★★★★ Relevant
Premier Toyocho Building 4,310 5,054.32 - - A - -
Ueno TH Building 4,380 4,799.97 - - A - -
Gotanda NT Building 4,100 7,545.80 - - A - -
Ueno Tosei Building 5,900 6,868.83 - - - ★★★☆☆ -
Urbannet Ikebukuro Building 13,600 25,050.26 - - A - -
Urbannet Omori Building 4,800 11,937.25 - - S - -
Sphere Tower Tennozu 15,000 47,151.72 - - S - -
Premier Yokohama Nishiguchi Building 3,558 7,562.90 - - A - -
NTT CRED Okayama Building 3,600 35,299.51 - - S - -
Urbannet Shizuoka Ote-machi Building 1,628 13,817.14 - - S - -
Urbannet Shizuoka Building 1,119 8,997.03 - - A - -
Urban Ace Higobashi Building 4,600 11,561.80 - - S - -
Roppongi Green Terrace 4,678 8,332.22 ★★★☆☆ - - - -
Premier Rosso 1,662 2,487.72 ★★★☆☆ - - - -
Premier Blanc Yoyogikouen 2,330 3,086.04 ★★★★☆ - - - -
Shibaura Island Air Tower 7,590 81,760.00 ★★★★★ - - - -
Shibaura Island Bloom Tower 5,550 104,186.74 ★★★★★ - - - -
Total of green eligible assets 146,749 - - - - - -
Total acquisition price of owned real estate properties 261,865 - - - - - -
Green eligible asset ratio 56.0% - - - - - -

As of April 30, 2021

Total of green eligible assets 146,749 million yen
Total assets LTV 47.7%
Green eligible liabilities
(Total of green eligible assets multiplied by total assets LTV)
69,956 million yen
Balance of proceeds from green finance 5,200 million yen
Of this, balance of proceeds from green bonds 5,200 million yen
Of this, balance of proceeds from green loans - million yen

Green Bonds

Name Issuance amount
(million yen)
Interest rate Issuance date Redemption date Use of proceeds
The 9th Unsecured Investment Corporation Bonds (green bonds) 2,000 0.060% 2021/04/27 2024/04/26 Repayment of loans (Otemachi Financial City Grand Cube, Urbannet Shizuoka Ote-machi Building and Urbannet Shizuoka Building) (Including loans for subsequent refinancing)
The 10th Unsecured Investment Corporation Bonds (green bonds) 3,200 0.500% 2021/04/27 2031/04/25 Repayment of loans (Otemachi Financial City Grand Cube, Urbannet Shizuoka Ote-machi Building and Urbannet Shizuoka Building) (Including loans for subsequent refinancing)

Green Loans

Lender Loan amount
(million yen)
Interest rate Loan date Repayment date Use of proceeds
- - - - - -

(3)Impact Reporting

  • Number of green eligible assets
  • Number, type and certification level of environmental certification of acquired assets
  • The following quantitative indices regarding green eligible assets
    (Disclosed within the scope of NUD’s energy management rights)

Amount of energy consumption
Amount of CO2 emissions
Amount of water consumption

Please click here for details regarding impact reporting

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