Stockholm (NordSIP) – Despite concerns that a new wave of COVID-19 cases might hit Europe during the Autumn, SEK fixed income investors continue to welcome real estate companies into the green market. On Monday, September 18th, Nivika Fastigheter AB issued a three-year senior unsecured green bond worth SEK 300 million.
The new green bonds pay a floating interest rate of 5.5% over the 3-month Stibor and were expected to be listed on the Nasdaq Stockholm stock exchange. Danske Bank and SEB acted as organizers and joint bookrunners in connection with the issue and have jointly structured the green framework. Cederquist has acted as legal counsel.
The issue proceeds from the green bonds will be used in accordance with the green bond framework and to refinance existing green projects. The framework received a Medium Green rating from Cicero Shades of Green. In terms of the green bond framework’s strengths, CICERO noted that “Nivika informs us that the majority of the proceeds will be used for the category Green and energy-efficient buildings.”
“The Green Finance Framework of Nivika sets fairly high, but realistic criteria for this category, and will secure sound improvements going forward,” the rating agency said. “Substantial impact reporting increases transparency to investors and is a strength of the framework.” However, the second opinion provider also noted that Nivika’s lack of a quantitative target for greenhouse gas emissions (at least scope 1 and 2) in the short and long term, is a weakness. Although it also noted the absence of external advice will not be a part of the green project selection process, CICERO seemed to argue that this problem was addressed by the fact that Nivika uses external advice in almost all new building projects, from material discussions to energy consumption and sustainability.
Nivika Fastigheter AB (publ) is a cash flow-oriented real estate company that acquires and manages properties primarily in Jönköping, Värnamo and Växjö. Over the last four years, Nivika has increased the value of its property portfolio from SEK1.6 billion to SEK 4.9 billion.
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