Lloyds Bank has written a £61 million (€67 million) loan for a Birmingham office building through its Green Lending Initiative.
Lloyds’ £1 billion ‘green’ commercial property lending fund, launched in March last year, provides margin reductions of up to 20 basis points on loans that finance energy-efficient schemes.
The debt facility, provided to Nurton Developments, will finance 2 Colmore Square. The office building is now intended to switch to 100 percent renewable energy sources.
The 160,000-square-feet scheme was taken on by Nurton when the 1960s block was in a dilapidated state and carried out more than £10 million of refurbishments with the adjacent Cannon House to create a development with a combined 300,000 square feet.
The owners say the building will switch to renewable power sources, with smart meters installed for every tenant.
“Now, with the support of Lloyds Bank, our long-term banking partner, we’re further enhancing its status as one of Birmingham’s greenest buildings, which is critical at a time of increasing competition, and when forward-thinking occupiers are looking to move into more sustainable space,” said Paul Bradshaw, Nurton’s finance director.
Lloyds’ Green Lending Fund provides debt with a margin reduction for borrowers requiring more than £10 million financing. Under the lending terms, borrowers need to meet and maintain agreed energy/CO2 saving performance indicators.
In April, Lloyds arranged a €600 million syndicated financing for French REIT Unibail-Rodamco, priced against ‘green’ performance criteria. The five-year revolving credit facility would enable Unibail to refinance a 2011 debt facility, providing the Paris-based company with liquidity for general corporate purposes.
This was the first time a loan arranged through the scheme was syndicated, meaning that Lloyds used the green initiative on its portion of the financing and its syndication partners followed the principle.
Also this year, Lloyds refinanced £61 million of debt secured by a portfolio of UK business centres through its green initiative.