OUE REIT has issued its second 7-year investment grade green notes of $150 million at a 2.75% fixed rate due 2032.
The notes have a “BBB-” rating by S&P Global Ratings, and are issued under OUE REIT’s $2 billion Euro Medium Term Note Programme.
The REIT says it will use net proceeds raised from the notes exclusively to finance or refinance in whole or in part, new or existing eligible green projects that meet one or more categories of eligibility as recognised in the International Capital Market Association's Green Bond Principle and Loans Syndications and Trading Association's Green Loan Principles.
The REIT notes that the initial price guidance of 3.05% garnered a peak orderbook of $412.8 million, representing 2.8 times oversubscription, resulting in the final pricing to be tightened to 2.75%.
This represents a 30 bps reduction from the initial price guidance, and a 115 bps compression compared to the previous 7-year investment grade green notes issued in September 2024. 80% of the final allocation went towards institutional investors.
Following the issuance and the successful completion of OUE Bayfront refinancing in August 2025, 16.2% of OUE REIT’s total debt is due in 2026. On a pro forma basis as of June 30, the weighted average cost of debt will be reduced to 4.0% p.a. from 4.2% p.a., while the weighted average debt maturity will be extended to 3.6 years from 2.7 years.
See also: OUE REIT establishes $500 mil commercial paper programme
Oversea-Chinese Banking Corporation is the sole global coordinator, while DBS Bank, and Oversea-Chinese Banking Corporation are the joint lead managers and bookrunners of the offering of the Notes. Oversea-Chinese Banking Corporation Limited is also the green finance adviser for the offering of the notes.
Units in OUE REIT closed 0.5 cents lower or 1.429% down at 34.5 cents on Oct 8.
