AXA IM Alts’ flagship European open-ended real estate fund has raised €500m via a green bond issue to be used to replace a number of existing debt facilities.
The €162bn asset manager said the AXA CoRE Europe fund’s green bond – which represents the first issuance undertaken by the fund – attracted strong demand and was oversubscribed with an order book amounting to €1.8bn.
The green notes were placed across a broad range of 80 European and international institutional investors.
AXA IM Alts said the proceeds will be used to replace a number of existing debt facilities while reducing the fund’s average cost of debt and improving average maturity.
The AXA CoRE Europe fund seeks to provide institutional investors with long-term stable income through the acquisition of core real estate assets across major cities in Europe.
Isabelle Scemama, the global head of AXA IM Alts, said: “The success of the fund’s inaugural green bond is an important achievement for the AXA IM Alts platform and a further indication of our overriding ambition to provide market-leading returns to our clients while at the same time pursuing strategies and investments that allow us to make a positive contribution to society and improve tomorrow.”
Timothé Rauly, the global head of fund management at AXA IM Alts, said in addition to the immediate benefits of reducing the cost of debt and extending the average debt maturity, the green bond will diversify the source of financing.
“The capital structure of the fund remains unchanged. This access to the debt capital market will facilitate the growth of the fund and reinforces its access to larger core investments where there is less competition.
“Furthermore, we believe the success of the transaction, being four times oversubscribed, is a clear endorsement of the quality of assets in the fund’s portfolio, as well as its investment and ESG strategies.”
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