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Green Finance / Treasury & Capital Markets
UOB Thailand extends green loan for Phuket rental housing project
Facility linked to reduction in energy consumption, water usage and GHG emissions
The Asset 27 Jul 2021

UOB Thailand has provided Asia Capital Real Estate (ACRE) with a 675 million baht (US$20.54 million) green loan, which will be used to develop an environment-friendly and affordable residential rental apartment complex in Phuket. The loan was approved under the UOB Real Estate Sustainable Finance Framework, which UOB says is the first lending framework by a Singapore lender dedicated to supporting sustainability-related projects in Asia’s real estate sector.

The project, HOMA Phuket Town, is a 505-unit rental housing development with features such as solar panels, energy-efficient appliances, LED lighting, advanced air quality monitoring, and efficient air-conditioning. It is designed to meet the green building standards of Excellence in Design for Greater Efficiencies (EDGE Advanced) established by the International Finance Corporation (IFC). It aims to achieve more than 40% reduction in energy and water usage compared with a conventional building.

HOMA Phuket Town will seek to reduce around 325 tonnes of carbon dioxide equivalent in greenhouse gas (GHG) emissions per year. The target is equivalent to having close to 5,370 new tree seedlings grown over 10 years or taking close to 71 cars off the road for a year. The project also aims to be the first residential rental property in Thailand to obtain a Leadership in Energy and Environmental Design (LEED) certification upon completion this year.

Andy Cheah, managing director and country head of wholesale banking at UOB Thailand, says: “Our financial support to ACRE reflects our commitment to forging a sustainable future with our clients, through our involvement in the country’s real estate development. Local communities will benefit from facilities that are environmentally friendly and which promote the well-being of residents.”

The UOB Real Estate Sustainable Finance Framework is designed specifically for companies that own or manage real estate assets, such as data centres, hotels, industrial and residential properties, offices, restaurants and retail spaces. The financing framework sets out the eligibility criteria, including sustainability strategy, objectives, ratings and performance targets, for companies to meet when applying for green loans or sustainability-linked loans.

Under the framework, the bank will record and monitor the borrower’s management of loan proceeds, as well as track the sustainability metrics agreed upon with the company.

The project incorporates various low-impact development strategies such as vegetated open spaces and permeable hardscaping, which will also help in reducing the heat island effect and contribute to a cooler micro-climate in and around the site.   A "reduce and recycle" approach has been adopted for conserving potable water on site. The consumption of potable water will be reduced by installing efficient low-flow water fixtures and through the use of native or adaptive plant species, which will also support the local habitat. Additionally, rainwater harvesting and an on-site sewage treatment plant will help significantly reduce potable water demand.

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