K Raheja Corp-backed Mindspace Business Parks REIT has raised Rs 550 crore from the International Finance Corporation (IFC), part of the World Bank Group, via IFC’s subscription to its sustainability-linked bonds (SLBs). The fresh fundraise follows a similar deal last year, when the REIT secured Rs 650 crore.
This takes Mindspace REIT's total SLB issuance to Rs 1,200 crore. In a release, Mindspace REIT said that this is the first issuance of a SLB after the Securities and Exchange Board of India (SEBI) released a new framework for debt securities that adhere to environment, social, and governance (ESG) standards.
"With this issuance, we’re taking a big step forward on our sustainability journey. Being the first REIT to raise Sustainability Linked Bonds under SEBI’s new ESG framework shows our intent to lead from the front. Partnering with IFC gives us global backing, and it will help us drive energy efficiency, add more green-certified space, and build a portfolio that’s ready for the future," said Ramesh Nair, managing director and CEO of Mindspace REIT.
The Rs 550 crore SLB has a tenure of eight years, with law firm Shardul Amarchand Mangaldas acting as the legal counsel to Mindspace REIT for the issue. The bond received a 'AAA' rating from ICRA. Sources said that the bond has a semi-annual coupon of 7.414 percent.
Sustainability-linked bonds allow the recipient of the funds to meet objectives related to ESG, with the targets pre-decided at the time of issuance. Some SLBs also have a step-down coupon once the ESG targets are achieved.
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