CBA offers Australia’s ‘first’ commercial build-to-let green loan
The big bank is financing a green loan worth $130 million for Australia’s “first build-to-let development”.
A $130 million green loan has been provided to Oxford Properties Group (Oxford) and Investa-owned build-to-let management platform Indi by the Commonwealth Bank of Australia (CBA) to help fund Sydney CBD’s first build-to-let. development.
It is believed to be the country’s first build-to-let green loan.
According to a statement provided by the CBA, the loan will contribute to the construction of Indi Sydney City, a 234-unit, carbon-neutral 5-star Green Star building.
The development will be delivered and managed by Indi.
The ABC also said it would be the first build-to-let development to achieve an energy rating from the National Australian Built Environment Rating System (NABERS).
Indi Sydney City is set to include a range of environmentally focused inclusions, such as regenerative lifts which will deliver between 20-25% improvements in lift energy efficiency; high-efficiency central cooling system and tempered air conditioning; provision of energy and water efficient appliances to all apartments; and sub-metering for “better monitoring of operational performance”.
Oxford and Investa secured the loan by collaborating on a “Green Finance Framework” in accordance with the Green Lending Principles (GLP) – a benchmark guideline for issuing green loans across the world.
Speaking about the loan, Michael Thorpe, Managing Director of CBA, Future Cities and Networks, said Indi Sydney City was designed to “deliver exceptional sustainability outcomes, so that residents share views and amenities, as well as the building’s energy-efficient infrastructure”.
“We are delighted to bring the first premium build-to-let offering to the Sydney residential rental market, and one that has achieved Green Loan certification thanks to its strong sustainability credentials and commitment to delivering results. positive environmental factors,” Thorpe added.
Oxford’s Director of Development, Nellie O’Keeffe, echoed that sentiment, saying: “Indi Sydney City is a wonderful example of how an energy-efficient, low-carbon community can be developed and operated in stock.
“At Oxford Properties, our goal is to create economic and social value through property, protecting the future and creating opportunity for our customers, communities, partners and associates.
“Securing this green loan will help us provide one of the most sustainable places to live in Sydney.”
Investa’s managing director, corporate sustainability, Margot Black, noted that the loan reflects the platform’s focus on building a low-carbon economy.
“Investa has been focused on diversifying its sources of debt and supporting the growth of the sustainable finance market in Australia since the platform closed its first green loan in 2019,” she says.
“The successful development of a green finance framework with Oxford and the execution of the first green loan for the Indi platform under this framework is a significant achievement for all parties.
“This further reinforces our leadership position in corporate sustainability and reflects our long-term commitment to the transition to a low-carbon economy.”
The announcement comes after a series of environment-focused measures taken by the big four banks in recent months.
Earlier in October, the ABC confirmed that it had launched a pilot program for a new program designed to provide its customers with personalized carbon footprint tracking built around their spending data.
In September, the big bank set up a commercial real estate loan upgrade for any company wishing to reduce both operating and environmental expenses.
In July, The ABC has announced that it will roll out its green loan across the country, making it available to up to 600,000 of its customers.
Read more about green loans and the environmental case for reducing your carbon footprint in the September issue of The Adviser, out now.
[Related: CBA to show customers their carbon footprint]
Sam Nichols is a journalist at The Adviser and Mortgage Business. His reporting has appeared in a range of outlets including ABC News, SBS’ The Feed and VICE.