Green bonds enable more sustainable developments

6/21/2018 8:00 AM CET

Skanska has issued green bonds amounting to SEK 1 billion to finance sustainable commercial development projects in the USA, Sweden and Poland. The transaction generated a substantial attention among investors, attracting bids for more than SEK 3 billion.

Sthlm 01, a 27-story Commercial Development underway in Stockholm, is among the projects we’re partly financing through our latest green bonds.

Skanska is determined to be the leading green project developer and builder, and to collaborate with our customers to achieve resilient and zero/low-carbon solutions. To leverage our extensive green expertise and portfolio while diversifying our investor base, we have issued SEK 1 billion of green bonds.

This financing will enable us to continue investing in sustainable, profitable commercial developments at a more rapid pace than we can achieve solely through our own capital.

Positive impacts for society

"An increasing share of our customers and investors are interested in a higher degree of sustainability," says Lena Hök, Senior Vice President of Sustainability, Skanska AB. "This spurs us to drive innovation for increased sustainability in our projects. Skanska’s green bonds with the reporting about the environmental impacts from our projects is a way to assure our investors that their involvement and investments does have an impact."

Top green certifications

Issued at the end of May, these bonds were divided into two tranches of SEK 500 million, each with tenors of 2.5 and 5 years, respectively. Initially, the bonds will fund four commercial developments, each of which is seeking the highest level – Platinum – of the international green certification LEED (Leadership in Energy & Environmental Design). They may also be used to fund residential developments.

This was the second set of green bonds issued by Skanska, following our first green bond issued in April 2014.

Listed on Nasdaq Sustainable Bond Market

Investors in the bonds include Alfred Berg Kapitalförvaltning, Carnegie Fonder, Kammarkollegiet, Nordea Investment Management, Storebrand/SPP Asset Management, Swedbank Robur and Öhman fonder. Svenska Handelsbanken and Swedbank acted as joint lead managers of the deal. The bonds are listed on Nasdaq Sustainable Bond Market.

Aligned to UN Sustainable Development Goals

The CICERO Center for International Climate Research, which is internationally recognized as a leading provider of independent reviews of green bond frameworks, reviewed our Skanska’s Framework and deemed it strong and trustworthy. A key aspect of this framework is that the environmental impact reporting is aligned with the United Nations’ Sustainable Development Goals. More information about our green bonds and Green Bond Framework can be found in the Investors section of SEB has been the adviser for Skanska’s Green Bond Framework.

Increasing green financing

At the end of the first quarter of 2018, Skanska's central debt amounted to SEK 3.6 billion, of which about 70 percent consisted of green financing, including green bonds. Our aim is to have close to 100 percent of our central financing from green and sustainable loans and bonds.

Green integral to our culture

More than 70 percent of the revenue from our Swedish and UK construction operations comes from green projects, as defined by the Skanska Color Palette™. Of our own project development operations, green projects account for more than 90 percent of the project value.

Furthermore, Skanska was charged by Fossil Free Sweden, an initiative of the Swedish government, to create a roadmap for achieving a climate-neutral construction sector in Sweden. This road map – which we believe to be the first of its kind – was endorsed by more than 60 stakeholders and was handed over to the Government in April 2018.