Mindspace Becomes First Indian REIT to Issue Sustainability-Linked Bonds

Mindspace Business Parks REIT, the owner and developer of quality Grade A office portfolio, has announced its ₹650 crore Sustainability Linked Bond issuance placed with the International Finance Corporation (IFC). The coupon of the bond is linked to Mindspace’s commitment to achieve certain ESG targets towards building a greener eco-system.

Sponsored by the K Raheja Group

Mindspace REIT is sponsored by the K Raheja Group. It has a portfolio of 33.2 million square feet comprising 26.3 million square feet of completed area. Mindspace REIT has undertaken certain ESG targets critical to its operations. These include reduction in GHG emissions (Scope 1, 2 and 3), increasing the share of green certified area for existing buildings (under operations and maintenance), and reduction in energy intensity. We are thrilled to announce another significant milestone in our sustainability journey as we become the first Indian REIT to issue sustainability linked bonds. International Finance Corporation fully subscribed to this issuance. This follows our maiden green bond issue in March 2023,” said Ramesh Nair, CEO, Mindspace Business Parks REIT.

Purpose to ‘build sustainable ecosystems’

Ramesh Nair said, “Our purpose to ‘build sustainable ecosystems‘ helps us create long-term value for stakeholders, blending financial success with the environmental and social benefits.” The coupon of the bond is linked to Mindspace’s commitment to achieve certain ESG targets towards building a greener eco-system, the company said in a statement. The coupon of these bonds is fixed in nature, and shall be stepped down, in a staggered manner, based on achievement of the set targets. These bonds are issued for a tenure of 7 years.

India’s net-zero ambitions

Commenting on the partnership with Mindspace REIT, Wendy Werner, IFC Country Head for India said, “We are pleased to partner with Mindspace REIT for its maiden sustainability-linked bond. IFC’s investment will help Mindspace enhance the sustainability of its portfolio of business parks and reduce greenhouse gas emissions year-on-year.” This partnership aligns with India’s net-zero ambitions and demonstrates the viability of climate finance in the real estate sector. Our support aims to attract more diverse and long-term funding at a time when private capital is critical to build a greener, more resilient future.

Collaboration with IIT Bombay

Mindspace Business Parks REIT in January 2024 had announced its collaboration with IIT Bombay for a research project centered on Climate Risk Assessment. As a pilot project, it had set up on-site weather stations at Mindspace Airoli West in the Mumbai Metropolitan Region.