Oficea, a leading property company in Mauritius, has announced the successful issuance of a MUR 3.4 billion Sustainability-Linked Bond. This significant transaction marks one of the largest sustainable finance deals undertaken in Mauritius in recent years. The bond was advised by MCB Capital Markets, a prominent financial services company. The issuance is part of ER Group's Sustainable Finance Framework, which aims to integrate sustainability into the company's real estate development and management practices.
The Sustainability-Linked Bond was subscribed by a diverse range of institutional investors, including banks, insurance companies, and pension funds. The transaction was 1.5x oversubscribed, demonstrating strong investor demand and confidence in Oficea's sustainability strategy. The bond was assigned an A rating by CARE Ratings, further validating the company's commitment to sustainable finance. The proceeds from the bond will be used to refinance existing debt and finance Oficea's new office development, The Grid, in Telfair, Moka.
Oficea's sustainability strategy is focused on achieving more than 70% green-certified buildings by 2030. To achieve this target, the company is implementing a comprehensive plan covering both existing assets and future developments. Existing buildings will progressively work towards LEED Operations & Maintenance (LEED O+M) certification, while newly developed and future assets will be designed in accordance with LEED Building Design and Construction (LEED BD+C) standards.
The Sustainability-Linked Bond is a key milestone in Oficea's journey towards sustainability. Johan Pilot, CEO of ER Property, emphasized the company's commitment to integrating sustainability into its real estate decisions. The bond's sustainability performance targets are linked to key performance indicators (KPIs) specifically tailored to the real estate sector. This innovative approach demonstrates Oficea's dedication to environmental performance and responsible growth.
MCB Capital Markets played a crucial role in advising Oficea on the structuring and issuance of the Sustainability-Linked Bond. Rony Lam, CEO of MCB Capital Markets, highlighted the significance of this transaction, which demonstrates the growing maturity of the Mauritian capital markets. The deal also reflects the increasing importance of sustainable finance in supporting the transition of property businesses towards more environmentally friendly practices.
The transaction benefited from the support of FSD Africa, a UK Government-funded development agency, which financed the Second Party Opinion (SPO) provided by Moody's. Dr Evans Osano, Chief Financial Markets Officer at FSD Africa, congratulated Oficea and ER Group on this landmark issuance, which sets a valuable precedent for other African issuers. The deal demonstrates that the real-estate sector can access sustainable finance at scale in African markets.
The Sustainability-Linked Bond issuance is a significant step in the development of Mauritius' debt capital markets. Anish Goorah, Senior Vice President at MCB Capital Markets, noted that Oficea is the first Mauritian property company to raise a MUR 3.4 billion Sustainability-Linked Bond. This innovative transaction marks an important milestone in the growth of sustainable finance in Africa and demonstrates the potential for similar deals in the region.
Key points
- Oficea aims to achieve more than 70% green-certified buildings by 2030.
- The Sustainability-Linked Bond was 1.5x oversubscribed, demonstrating strong investor demand.
- The transaction marks one of the largest sustainable finance deals undertaken in Mauritius in recent years.
