Green Finance
NMF practices investment management taking into consideration Environment, Society and Governance (“ESG”). As a part of such initiatives, NMF strives to realize a sustainable environment and society by implementation of green finance including green bonds and green loans etc...
Green Bonds
Green bonds are a type of bond instrument to finance eligible green projects and they are issued in accordance with the Green Bond Principles established by the International Capital Markets Association.
Green Loans
Green loans, like green bonds, are borrowings to procure funds to be used for environmentally friendly businesses, in accordance with the Green Loan Principles, an international guideline.
Green Finance Framework
NMF established Green Finance Framework in order to implement green finance.
（1）Use of Proceeds
NMF will allocate all procured proceeds from green finance for the following funds.
- The funds for acquisition of eligible green projects(*)
- The funds for refinancing of borrowings used to acquire eligible green projects
- The funds for redemption of outstanding investment corporation bonds issued to acquire eligible green projects.
- ※Eligible green projects are existing or new specified assets that fulfill the criteria indicated in (2) Eligible Criteria below.
（2）Eligible Criteria
Eligible Criteria must acquire any of the valid certifications or be recertified in a. through c. below within 36 months after the date of receiving proceeds from green finance, or must be scheduled to acquire such (re)certification in the future.
- a.3, 4, or 5 Stars under DBJ Green Building Certification
- b.3, 4, or 5 Stars under BELS Certification
- c.B+, A or S rank under CASBEE Certification for Real Estate.
- ※Please refer to NMF's acquisition status of raising the Proportion of “Green” Properties in Our Portfolio.
（3）Project Evaluation and Selection Process
Eligible criteria are established by the Sustainability Promotion Committee (committee chaired by the Head of the NMF Investment Management Group) of Nomura Real Estate Asset Management Co., Ltd., the asset management company of NMF, and determined by the Investment Committee.
Eligible green projects in which proceeds from green finance will be invested are evaluated and chosen by the NMF Investment Management Group and Finance & Accounting Department based on eligible criteria, and the selection is made upon approval by the Investment Committee or the Head of the NMF Investment Management Group based on decision-making authority rules of the asset manager.
（4）Management of Proceeds
NMF shall set the debt amount calculated by multiplying the total book value of eligible green projects owned by NMF by total assets LTV (Loan-to-Value Ratio) as of the most recent fiscal period end calculable as of the date of obtaining proceeds (the "Eligible Green Debt Amount") as the upper limit of the balance of green finance. NMF manages to ensure that the balance of green finance will not exceed the Eligible Green Debt Amount. Furthermore, as long as the balance of green finance exists, NMF will internally track and manage the allocated funds on a portfolio basis.
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| Total book value of eligible green projects | 480.7billion yen |
|---|---|
| LTV ratio | 43.9% |
| Total eligible green debt amount | 211.1billion yen |
| (Note) | The total book value of eligible green project and LTV ratio are as of the end of February 2024. |
|---|
（5）Reporting
a. Reporting on Allocation of Proceeds
NMF's allocation of proceeds as to green finance is as follows.
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| Total amount of outstanding green bonds | 10,000 million yen |
|---|---|
| Amount of proceeds not yet allocated | - |
| Total amount of outstanding green loan | 4,000 million yen |
|---|---|
| Amount of proceeds not yet allocated | - |
Green Bond
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| Name | Amount issued (Millions of yen) |
Interest rate | Issuance date | Redemption date | Term |
|---|---|---|---|---|---|
| Nomura Real Estate Master Fund, Inc. Unsecured Bonds No.4 （Green Bonds） |
3,000 | 0.53% | September 20, 2019 | September 20, 2029 | 10 Years |
| Nomura Real Estate Master Fund, Inc. Unsecured Bonds No.6 （Green Bonds） |
7,000 | 0.54% | August 14, 2020 | August 14, 2030 | 10 Years |
Green Loan
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| Lender | Amount (Millions of yen) |
Interest rate | Drawdown Date | Terms of Repayment | Term |
|---|---|---|---|---|---|
| SUMITOMO LIFE INSURANCE COMPANY | 2,500 | 0.78474% | August 26, 2022 | February 26, 2031 | 8 Years and 6 Months |
| Nippon Life Insurance Company | 1,000 | 1.28875% | August 28, 2023 | August 26, 2032 | 9 Years |
| Nippon Life Insurance Company | 500 | 1.42188% | August 28, 2023 | August 26, 2033 | 10 Years |
b.Impact Reporting
NMF shall disclose the following indices as of the end of every February as long as the balance of green finance remains.
- Number of Eligible Green Projects
- Level of each green certification acquired
- Greenhouse gas (GHG) emissions, energy consumption and water consumption at Eligible Green Projects(*)
- ※The range of Eligible Green Projects and actual figures are disclosed as of the time of report submission.
Until the 2022 results, this covered the portion over which the NMF possesses control authority, after 2023 results, the scope has also been expanded to include areas over which the NMF possesses no control authority about Greenhouse gas (GHG) emissions, energy consumption due to changes in materiality in the environment of the NMF.
Regarding water consumption, we will cover the portion over which the NMF possesses control authority even after 2023 results.
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| Unit | 2021 | 2022 | 2023 | |
|---|---|---|---|---|
| Properties | properties | 59 | 70 | 65 |
| GHG Emissions | t-CO2 | 25,848 | 29,674 | 43,123 |
| GHG Emissions Intensity | t-CO2/㎡ | 0.0396 | 0.0439 | 0.0363 |
| Energy Consumption | Kl | 15,012 | 15,904 | 25,236 |
| Energy Consumption Intensity | Kl/㎡ | 0.023 | 0.0235 | 0.0212 |
| Water Use | ㎥ | 226,879 | 305,654 | 322,260 |
| Water Use Intensity | ㎥/㎡ | 0.3475 | 0.4525 | 0.5261 |
- ※For level of each green certification acquired please see here.
Evaluation by External Organization
NMF has acquired “Green 1(F)”, the highest rating in JCR Green Finance Framework Evaluation by Japan Credit Rating Agency, Ltd. (JCR) for its eligibility of green finance framework.
JCR Green Finance Evaluation：https://www.jcr.co.jp/en/greenfinance/green/