Aegis Value REITs Issues First Ever 'Green Bond' Among Listed REITs

Aegis Value Plus REIT (hereinafter Aegis Value REIT) will become the first domestically listed REIT to issue a Green Bond. It will raise 60 billion KRW in response to market expectations.

Aegis Asset Management announced on the 22nd that Aegis Value REIT will issue a 60 billion KRW Green Bond through a public offering. Although the initial target was 40 billion KRW as stated in the securities registration statement, the registration was amended to 60 billion KRW after confirming excess demand in the market.

The lead underwriters are Samsung Securities, Korea Investment & Securities, and KB Securities. Of the 60 billion KRW, 50 billion KRW will be issued as a 1-year bond and 10 billion KRW as a 2-year bond. The interest rates are 7.0% for the 1-year bond and 7.2% for the 2-year bond, with interest paid monthly. The issuance is scheduled for the 27th.

Aegis Value REIT is Aegis Asset Management’s first publicly offered and listed REIT, having been listed in July 2020. Its representative underlying assets include prime-grade offices in Seoul’s Central Business District (CBD), such as the Taepyeongno Building and Twin Tree Tower. Previously, it received a corporate credit rating of 'A- (stable)' from both Korea Ratings and Korea Investors Service, meeting the conditions for public bond issuance.

This public bond is the first Green Bond issued by a domestically listed REIT. Green Bonds are bonds issued to raise funds for environmentally friendly projects. Their use is limited to green industries such as ▲environmentally friendly businesses and ▲renewable energy projects.

The purpose of the public bond is to repay loans for purchasing environmentally friendly buildings. It will repay debt incurred from purchasing beneficiary certificates of the fund that owns Twin Tree Tower last year. Twin Tree Tower has received the highest rating, Platinum, from the international green building certification system LEED.

Aegis Value REIT is smoothly restructuring its borrowing through various fundraising methods such as rights offerings and public bonds. In August, it raised 62.8 billion KRW through a shareholder rights offering. Using these funds, it repaid 60 billion KRW of the 176 billion KRW bridge loan taken out to purchase Twin Tree Tower. This public bond will repay an additional 60 billion KRW, and the remainder will be managed through maturity extensions and other measures.

An Aegis Asset Management official said, “Our efforts to invest in prime-grade offices in Seoul’s core areas and improve the environmental sustainability of our assets have led to market expectations for this Green Bond issuance. We will continue to do our best to maximize the REIT’s dividend stability and profitability by utilizing optimal financing methods.”

This content was produced with the assistance of AI translation services.