Century Square, a property that will come fully under the ambit of Frasers Centrepoint Trust with its acquisition of the remaining stake in ARF. (Photo: Frasers Centrepoint Trust)

Retail REIT Frasers Centrepoint Trust (FCT) has secured Singapore’s first green financing solution that comprises a green loan and carbon credits.

The arrangement comprises a green SGD419 million loan, which will be used to refinance a maturing facility, asset enhancement initiatives, and decarbonisation programmes.

Meanwhile, the carbon credits, sourced through OCBC’s Emissions Trading Desk, will go towards investing in Verra or Gold standard certified carbon reduction nature-based projects.

The amount of carbon reduced will be equivalent to the financed emissions associated with the green loan.

FCT will further purchase additional carbon credits to account for the residual and unavoidable Scopes 1 and 2 as well as energy-related Scope 3 emissions of the mall’s carbon footprint.

“The introduction of this financing solution comes at an opportune time when carbon credits are increasingly considered by corporates to offset residual and unavoidable emissions after taking the necessary steps to reduce their carbon footprint as much as possible”, said the REIT.

FCT was last done on the Singapore Exchange at SGD2.16, which presently implies a distribution yield of 5.68% according to data on the Singapore REITs table.

By Shariffa Al-Habshee

Shariffa joined REITsWeek in 2017, and monitors Asia-Pacific REITs for the publication.