Singapore-based lodging trust CapitaLand Ascott Trust ( CLAS ) has secured a S$165 million ( US$124.7 million ) a multi-currency revolving credit sustainability-linked loan ( SLL ) from local bank OCBC.

Under the loan agreement, CLAS will receive interest rate reductions upon meeting the agreed annual greenhouse gas ( GHG ) emissions reduction targets. Proceeds of the facility will be used for general corporate purposes. 

CLAS’ GHG emissions reduction targets, the firms note, are aligned with its sponsor CapitaLand Investment’s ( CLI ) 2030 Sustainability Master Plan. CLI, Singapore’s biggest developer, has committed to achieving net-zero emissions by 2050 for its Scope 1 and 2 GHG emissions, and targets to reduce absolute Scope 1 and 2 GHG emissions by 46% by 2030 ( using 2019 as the base year ).

These targets have been validated by the internationally recognized Science Based Targets initiative ( SBTi ) in 2022 to be in line with a 1.5 degree Celsius trajectory, in alignment with the goals of the Paris agreement.

The loan, the bank says, reflects its commitment to supporting its customers on their net-zero journeys with market-leading transition advisory and innovative financing solutions. The bank’s sustainable financing loans, as of June 30, have grown 33% from a year ago, and total sustainable financing loan commitments stood at S$63.3 billion.

“With this facility, CLAS has secured a total of over S$700 million in sustainable financing to date,” says Serena Teo, CEO of CapitaLand Ascott Trust Management and CapitaLand Ascott Business Trust Management ( the managers of CLAS ).

Elaine Lam, OCBC’s head of global corporate banking, adds: “Despite macroeconomic challenges, it has been very encouraging to see more companies across various sectors in the region chart out their net-zero journeys and setting SBTi-aligned decarbonization targets. For those companies that are not quite as advanced yet, we have been actively engaging them on their transition plans and viable next steps to take.”