Masdar Green REIT signs green financing commitment with First Abu Dhabi Bank for growth of its portfolio

18 Jan 2022

10 mins

Masdar City, Masdar’s pioneering sustainable urban development in Abu Dhabi, through its Masdar Green Real Estate Investment Trust (REIT), has signed a financing commitment in the amount of USD$200,000,000, with First Abu Dhabi Bank (FAB) relating to financing of the REIT portfolio to facilitate further acquisitions and portfolio growth. FAB will act as sole mandated lead arranger and bookrunner, green loan coordinator, agent, security agent and account bank for this transaction.

The announcement was made during an official signing ceremony held at the 4th Abu Dhabi Sustainable Finance Forum during Abu Dhabi Sustainability Week - the global platform for accelerating sustainable development hosted by Masdar. The announcement comes 12 months after Masdar City partnered with Emirates NBD Asset Management to receive management services for the UAE’s first sustainable REIT. 

“Investors are increasingly looking for ‘responsible’ investment opportunities and evaluate companies based on specific environmental, social and governance (‘ESG’) practices criteria,” said Abdulla Balalaa, Executive Director, Masdar City and Chairman of the REIT. “The Masdar Green REIT’s portfolio currently includes four commercial properties within Masdar City, which is the pioneering sustainable urban development project, and technology innovation hub, in Abu Dhabi. The financing from First Abu Dhabi Bank, will help the REIT in building its sustainable real estate portfolio through additional acquisitions of properties in Masdar City. The proceeds of these acquisitions will in turn assist Masdar City to bring more sustainable real estate assets to market through new sustainable developments and continuing the future expansion of Masdar City” 

“The Masdar Green REIT will give investors the responsible and forward-thinking investment options they are looking for, via these sustainable income-generating real estate assets, with a primary focus in Masdar City. The properties within the Masdar Green REIT’s current portfolio consume approximately 40 percent less electricity and water than comparable buildings in Abu Dhabi, targeting sustainability ratings of three Pearls or above on Abu Dhabi’s Estidama Pearl Building Rating System, while one asset is also LEED Platinum certified. This REIT also intends to provide a vehicle through which third-party, sustainable developers can monetize their assets, attracting both real estate developers to Masdar City, and aspiring local and international sustainable investors,” Balalaa continued. 

As the UAE's largest bank and one of the world's largest and safest financial institutions, FAB is a regional leader for sustainable finance in the Middle East. FAB issued the region’s first green bond in 2017 and has financed over USD 30 billion in sustainable projects to date. In 2021, the bank executed the first green repurchasing (‘repo’) transaction in the Middle East, structured in partnership with Deutsche Bank. FAB was also the first bank in the region to commit to net-zero greenhouse gas emissions by 2050 and to join the Net-Zero Banking Alliance and was part of the official UAE delegation to the COP26 climate conference. 

Mustafa Al Khalfawi, Head of Global Banking UAE and Global Head of Government, Sovereigns & Public Sector, Investment Banking Group, said, “First Abu Dhabi Bank has made a commitment to fund projects that deliver tangible environmental and social benefits, and we are leading the way forward in financing the transition to a more sustainable future. As one of our strategic clients, we are delighted to support Masdar City in this landmark transaction, with an innovative and flexible financing structure to enable the Masdar Green REIT to fulfil its strategic objectives. The transaction serves to underline FAB’s ongoing commitment to Masdar and sustainable financing, and we look forward to further deepening our relationship as Masdar implements its exciting plans to grow its high-quality portfolio.”

Masdar City announced it was launching the green REIT, the first in the UAE to invest solely in sustainable real estate projects, during Abu Dhabi Sustainability Week (ADSW) in January in 2020. The Masdar Green REIT was established at Abu Dhabi Global Market (ADGM) as a Qualified Investor Fund (QIF) and is managed by Masdar Capital Management Limited which is regulated by the Financial Services Regulatory Authority. Masdar Green REIT intends to offer an attractive opportunity for professional investors through private placement to invest in a unique portfolio of stable, income-producing, sustainable real estate assets. 

The Masdar Green REIT marks great progress in bringing the Abu Dhabi Sustainable Finance Declaration to life, which was signed in 2019 by 25 public and private sector entities, including Masdar City and the ADGM, and is aimed at establishing a healthy and sustainable finance industry that supports the UAE in attaining the United Nations Sustainable Development Goals.

Currently active in more than 40 countries, Masdar has been advancing the commercialization and deployment of renewable energy, sustainable urban development, and clean technologies, to address global sustainability challenges since 2006. In 2018, Masdar signed the first green revolving credit facility in the Middle East, helping to support its investments in global clean technology and sustainable real estate projects. 


About Masdar
Abu Dhabi’s renewable energy company Masdar is advancing the commercialization and deployment of renewable energy, sustainable urban development and clean technologies to address global sustainability challenges. Wholly owned by Mubadala Investment Company, the strategic investment company of the Government of Abu Dhabi, our mandate is to help maintain the UAE’s leadership in the global energy sector, while supporting the diversification of both its economy and energy sources for the benefit of future generations. Today, Masdar is active in more than 40 countries, including the UAE, Jordan, Saudi Arabia, Mauritania, Egypt, Morocco, the UK, the US, Australia, Spain, Serbia, India, Indonesia, Uzbekistan, and many more. 
About Masdar City
Masdar City in Abu Dhabi is one of the world’s most sustainable developments. It is a working model for cities around the world in environmental, economic, and social sustainability, and continues to push the boundaries of innovation. The City hosts Abu Dhabi’s only planned and approved R&D cluster; Masdar City Free Zone, which is a growing hub for sustainability-focused innovative businesses; and a residential neighborhood with restaurants, shops, sporting facilities and public green spaces. Masdar City is home to companies dedicated to developing innovations across the sectors of renewables, space, energy storage, artificial intelligence, agriculture, health, and mobility. These include, the headquarters of the International Renewable Energy Agency (IRENA), the UAE Space Agency, the regional headquarters of Siemens Energy, G42 Healthcare, the Advanced Technology Research Council, several Fortune 500 companies, hundreds of entrepreneurs, a startup accelerator program via The Catalyst, and the world's first university dedicated to artificial intelligence, the Mohamed bin Zayed University of Artificial Intelligence. Masdar City has also pioneered two generations of autonomous vehicles and continues to extend the frontiers of alternative and sustainable transport.
About First Abu Dhabi Bank (FAB) 
FAB is the UAE’s largest bank and one of the world’s largest and safest financial institutions. FAB’s vision is to create value for its employees, customers, shareholders and communities to grow stronger through differentiation, agility and innovation.
Headquartered in Abu Dhabi, the bank’s international network spans five continents, providing global relationships, expertise and financial strength to support local, regional and international businesses seeking to do business at home and abroad. FAB is a trusted adviser and regional partner to major institutions, emerging companies and individuals seeking to do business in the UAE, the MENA region and beyond. As an engine of growth for the region, it helps customers to thrive and grow stronger by managing risk, providing access to capital and facilitating trade flows across developed and emerging markets.
With total assets of AED 983 Billion (USD 268 Billion) as of September-end 2021, FAB is rated Aa3/AA-/AA- by Moody’s, S&P and Fitch, respectively - the strongest combined ratings of any bank in the MENA region. The Bank has been    ranked by Global Finance as the Safest Bank in the UAE and the Middle East, and the 32nd Safest Bank globally. The Banker’s Top 1000 World Banks 2021 rankings, measured by Tier 1 capital, ranked FAB as #1 in the UAE, #3 in the Middle East and #94 across the globe. FAB is also a regional sustainability leader (MSCI ESG rating of AA, ‘Leader’ category), and a constituent of MSCI ESG Leaders and FTSE4Good EM indices.

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