Environmental Initiatives
FRI aims to build a more solid financial foundation through efforts to expand the breadth of its investors by spurring demand among investors with a strong interest in ESG and to diversify its financing methods, as well as to go further in its pursuit of initiatives related to reducing environmental impact and building sustainable relationships with various stakeholders as stipulated in the Sustainability Policy.
Overview of Green Finance Framework
Use of proceeds from Green Finance
Proceeds from Green Finance shall be allocated towards the acquisition of green buildings （Eligible green assets） that meet the following eligibility criteria, to make repairs, or to refinance such loans.
Criteria for eligibility
- （1）Eligible green assets
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- Properties that have acquired or plan to acquire any of the certifications below, from third-party institutions:
- DBJ Green Building Certification : five stars, four stars or three stars
- CASBEE real estate certification : S, A or B+ rank
- BELS Certification : five stars, four stars or three stars
- LEED rating system : Platinum, Gold or Silver rank
- （2）Repair work
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- Any of the following repair work:
- Repair work carried out to improve the rank in certifications（1）above by one rank or more and to renew or acquire environmental certification
- Repair work to facilities and other aimed at making beneficial improvements for the environment, such as improving energy efficiency and water consumption performance (work resulting in a 30% or more improvement in performance)
Eligibility criteria and process for selection
The criteria for eligibility are discussed by the Sustainability Committee, which is chaired by the Chief Executive Officer and Representative Director of the Asset Management Company, and decided by the authority of the Chief Executive Officer and Representative Director.
The person in charge of finances at the Asset Management Company considers whether projects that will utilize the proceeds meet the criteria for eligibility, carries out an evaluation and makes selections.
Management of proceeds
The proceeds from green financing is promptly or swiftly used to acquire Eligible green assets, to repay loans used to acquire Eligible green assets, or to redeem investment corporation bonds issued to acquire Eligible green assets.
When some of the proceeds is not allocated, the liability amount calculated by multiplying the total acquisition cost for the Eligible green assets held by the FRI by the fiscal period-end LTV that can be calculated at the confirmation point （Eligible green liability amount） is set as the maximum for green financing, and the green financing balance is managed so that it does not exceed the Eligible green liability amount.
Green loan
- Interest rate is fixed until the maturity date.
- Borrowing will be repaid in a lump sum on the maturity date.
Green bonds
| Name | Issued amount (million yen) |
Interest rate | Issuance date | Maturity date | Collateral/Guarantee | Press release |
|---|---|---|---|---|---|---|
| 6th Series Unsecured Investment Corporation Bonds
(with special pari passu conditions among specified investment corporation bonds) |
1,500 | 0.400% | October 29, 2021 | October 29, 2031 | Unsecured / Unguaranteed |
|
| 7th Series Unsecured Investment Corporation Bonds
(with special pari passu conditions among specified investment corporation bonds) |
1,000 | 0.660% | October 29, 2021 | October 29, 2036 | Unsecured / Unguaranteed |
|
| Total | 2,500 | - | - | - | - | - |
Reporting
- （1）Reporting on status of financing allocations
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- The properties eligible for allocations will be disclosed on this website (hereinafter, the "Website"), in press releases or by other means when funding is raised.
When a property eligible for allocation is sold, it will be disclosed in a press release that the property received green financing. As long as there is a green financing balance, even after the sale, the following items as of the end of June every year will be disclosed on the Website. - Total acquisition cost for Eligible green assets
- LTV
- Eligible green liability amount
- Green financing balance
- The properties eligible for allocations will be disclosed on this website (hereinafter, the "Website"), in press releases or by other means when funding is raised.
- （2）Reporting on the effect of environmental improvements
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- As long as there is a green financing balance, the following items will be disclosed on the Website every year.
- Status of the acquisition of green building certification
(number of properties, gross floor area, percentage acquired [based on gross floor area]) - Name of buildings eligible as a green asset, type of green building certification, evaluation and date certification was acquired (renewed)
- Details of repair work and target properties if financing is allocated to repair work
(name, quantitative indicators related to environment before and after repair work, or type of green building certification and evaluation before and after repair work)
Evaluation by Outside Organizations
FRI obtained a Green 1 (F) rating from Japan Credit Rating Agency, Ltd. (JCR) in the JCR Green Finance Framework Evaluation, which is its highest rating in this third-party evaluation of its Green Finance Framework. Please see below for details.