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SCI Lamartine successfully issued its €500 10-yr inaugural Green Bond issuance dedicated to energy-efficient housing
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Natixis acted as Global Coordinator and Green Structuring Advisor and active Bookrunner for the issuance of €500 million inaugural Green Bond.
On Thursday 14th April, SCI Lamartine, a French residential real estate player, directly owned by CNP assurances and CDC Habitat successfully priced its inaugural €500m 10yr senior unsecured Green Bond. The proceeds will be exclusively used to finance or refinance, in part or in full, new and/or existing eligible Green Projects as set out and defined in the Lamartine Sustainability Bond Framework, which follow the technical screening criteria of EU Taxonomy Regulation [1] and Climate Delegated Act [2], in two main eligible categories: green buildings and energy efficiency. Eligible assets will have to meet the following criteria:
Figure 1: Eligibility criteria per category as set out in Lamartine Green Bond Framework
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Green buildings |
Acquisition of residential buildings located in France, either existing or currently under construction, which meet the following eligibility criteria:
And
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Energy Efficiency |
Investments in individual energy performance improvement measures aiming at improving energy efficiency – eligible investments are investments that are aligned to the technical screening criteria (TSC) of the EU Taxonomy:
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Source: : Authors (based on Lamartine Green Bond Framework)
In addition, eligible Green Projects must comply with the following additional criteria:
- Residential buildings must be located at a distance to public transport not exceeding 1000 meters ; and
- Must be located in areas with a lack of housing supply as defined by the State (A, Abis, B1, B2) and rated as Very Dynamic or Dynamic / Dynamic micro-market according to the internal rating tool of CDC Habitat ; and
- All off-plan projects must include eco-design considerations from the early stages of the design process of the building with the objective to limit the project’s environmental impact by optimizing energy efficiency, carbon footprint, waste management, water management, biodiversity preservation and land artificialization prevention.
The issuer will report annually on the allocation of proceeds as well as the environmental performance of the eligible Green Projects included in the portfolio on an annual basis, against the following indicators:
Figure 2: Indicators against which Lamartine committed to report
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Green buildings |
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Energy Efficiency |
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Source : Authors (based on Lamartine Green Bond Framework)
In Europe, buildings account for 40% of energy consumed and 36% of energy-related direct and indirect greenhouse gas emissions. Therefore, the real estate sector is a key lever in achieving the objectives set by the Paris Agreement to keep global temperatures from rising more than 2°C, with an ideal target of 1.5°C, by 2100.
The SCI Lamartine’s portfolio is on track to meet the 2040 trajectory of France National Low Carbon Strategy:
- The energy performance of the total portfolio of existing assets is currently 103 kWhEP/m²/year, outperforming the total portfolio of CDC Habitat (144 kWhEP/m²/year) ;
- Including the real estate assets currently under construction (Off-plan portfolio) with high energy, the overall energy performance level of the portfolio (52% of which is composed of Off-plans) is already reaching the 2050 objective of CDC Habitat ;
- 99% of the existing assets have energy labels better than D with an average label of C ;
Some dwellings (less than 1% of the stock) have E-labels and will be treated as a priority in the Capex plan.
Source: Authors (based on Lamartine Green Bond Framework)
In order to support its ambition to maintain and further improve the sustainability performance of the portfolio over time the SCI Lamartine has formalized an extensive impact investing strategy with 5 main objectives:
Figure 4 and Table 1: Presentation of Lamartine impact investing strategy
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Environmental aspects |
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Social aspects |
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Governance aspects |
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Source: Authors (based on Lamartine Green Bond Framework)
With the issuance of green bonds SCI Lamartine aims to further support its impact investment strategy, and notably its environmental commitments, with impactful and transparent bond instruments thus underpinning its ambition to align its financing strategy with its investment strategy and notably the achievement of exemplary objectives in order to promote energy-efficient housing.
The Framework is aligned with ICMA’s 2021 Green Bond Principles (GBP), Social Bond Principles (SBP) and Sustainability Bond Guidelines (SBG) and Moody’s ESG Solutions has provided a Second Party Opinion on the Sustainability Bond Framework. Natixis Green & Sustainable Hub assisted Lamartine SCI’s team to structure this Sustainability Bond Framework highlighting the company’s ambition to become an active player of sustainable finance.
To go further:
- Framework, SPO and Investor Presentation available here
[1] Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020
[2] Commission Delegated Regulation (EU) 2021/2139 of 4 June 2021
