We are at the forefront of drafting and structuring sustainability-linked loans, across social finance, housing finance, real estate finance and within our corporate borrower practice.

We’re proud to have worked on many innovative transactions, where lenders incentivise borrowers to tackle additional sustainability challenges, many of which are linked to the UN’s 2030 Sustainable Development Goals (and its Transform our World: 2030 Agenda for Sustainable Development).

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Recent Discloseable Sustainability-Linked Finance Transactions Include:

£400,000,000 SUSTAINABILITY-LINKED LOAN:

Addleshaw Goddard acts for Co-Operative Group (Co-Op) on £400,000,000 Sustainability linked loan 

Primary loan focus: revolving credit facilities 

Sustainable Finance Aspect: already widely recognised for its commitment to responsible and ethical trading, this will see the retailer take advantage of beneficial terms on its banking facilities should they hit various sustainability targets on areas such as CO2 reduction or, if those targets aren't achieved, Co-op will pay an agreed amount towards further sustainability projects. 

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£185,000,000 Sustainability-Linked Loan:

Addleshaw Goddard LLP acts for Bruntwood Science Limited on its £185,000,000 Sustainability –Linked Loan 

Primary Loan focus: green banking facilities to support its sustainable development of specialist workspace at Circle Square, Manchester

Sustainable Finance Aspect: these facilities allow Bruntwood to take advantage of beneficial terms on its banking facilities should they achieve a BREEAM Excellent rating for the three new buildings being developed and if they fulfil bespoke green covenants, such as delivering specified levels of investment into sustainably-linked improvements across its estate. 

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£60,000,000 SUSTAINABILITY-LINKED LOAN:

Addleshaw Goddard LLP acts for Sumitomo Mitsui Banking Corporation as Agent and Arranger on a £60,000,000 sustainability-linked loan with Paragon-ASRA Group

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: promoting "sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all" in accordance with Sustainable Development Goal 8 (Decent Work and Economic Growth) as published by the United Nations General Assembly

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£75,000,000 sustainability-linked loan:

Addleshaw Goddard LLP acts for National Westminster Bank PLC on a £75,000,000 sustainability-linked loan with Greensquare Housing Group

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: energy performance targets on the buildings which Bromford owns (not just those charged to secure the indebtedness here)

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£50,000,000 sustainability-linked loan:

Addleshaw Goddard LLP acts for First Abu Dhabi Bank PJSC as Agent and Arranger on £50,000,000 sustainability-linked loan with Aster Housing Group

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: helping tenants into sustainable employment – social mobility

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£50,000,000 sustainability-linked loan:

Addleshaw Goddard LLP acts for National Westminster Bank PLC on a £50,000,000 sustainability-linked loan with Bromford Housing Group

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: energy performance targets on the buildings which Bromford owns (not just those charged to secure the indebtedness here)

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£50,000,000 sustainability-linked loan:

Addleshaw Goddard LLP acts for Sumitomo Mitsui Banking Corporation on a £50,000,000 sustainability-linked loan with Catalyst Housing Group

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: ending poverty in all its forms everywhere" and promoting "sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all" in accordance with Sustainable Development Goal 1 (No poverty) and Sustainable Development Goal 8 (Decent Work and Economic Growth) as published by the United Nations General Assembly

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"The five-year, £50m revolving credit facility (RCF) provided to Catalyst Housing also marks the first SLL for the housing association. As with SMBC’s first sector SLL – a £100m RCF to Clarion in December – the loan has a margin tied to social impact indicators.

In the latest SLL, the metrics relate to the work of Catalyst Communities, the housing association’s community investment division, which manages a range of projects including youth mentoring schemes and employment and apprenticeship programmes in London and South East England.

The division’s ‘income maximisation’ team assists customers into part-time or full-time work, including through vocational training, as well as supporting others to claim the benefits they are entitled to.

If Catalyst meets pre-agreed targets to assist customers with maximising income, it will pay a lower interest rate on its debt to SMBC. Outcomes will be reported in Catalyst’s annual accounts.

The metrics are designed to address two of the United Nation’s ‘Sustainable Development Goals’, namely ‘no poverty’ and ‘decent work and economic growth’."

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£100,000,000 sustainability-linked loan:

Addleshaw Goddard LLP acts for BNP Paribas as Agent and Arranger on £100,000,000 sustainability-linked loan with Clarion Housing Group; and for Sumitomo Mitsui Banking Corporation as Agent and Arranger on a £100,000,000 sustainability-linked loan with Clarion Housing Group

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: promoting "sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all" in accordance with Sustainable Development Goal 8 (Decent Work and Economic Growth) as published by the United Nations General Assembly

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"SMBC’s £100m facility, understood to be its first SLL with a housing association, has a margin tied to Clarion supporting an agreed number of people into work each year.

The loan with BNP Paribas is also structured as a loan linked to employment KPIs. The metric measures the number of residents the housing provider supports into employment through the jobs and training programme of its charitable trust Clarion Futures. If Clarion meets the agreed targets, it will receive a lower interest rate on the loan."

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£50,000,000 sustainability-linked loan:

Addleshaw Goddard LLP acts for First Abu Dhabi Bank PJSC as Agent and Arranger on £50,000,000 sustainability-linked loan with Wrekin Housing Group

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: training and development – social mobility

"As part of a wider refinancing which we acted for the lenders on, Wrekin borrowed a £50,000,000 SLL from First Abu Dhabi Bank PJSC, which whilst used to fund the development and maintenance of much needed social and affordable housing, also incentivises Wrekin Housing Group to provide training and development to tenants, as against an annually renewable target, to help get more unemployed tenants to find employment, and improve social mobility."

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£75,000,000 sustainability-linked loan:

Addleshaw Goddard LLP acts for BNP Paribas as Agent and Arranger on £75,000,000 sustainability-linked loan with Peabody Housing Trust

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: childcare facilities – indirectly helping with UN Sustainable Development Goals

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"The facility is structured as a sustainability-linked loan (SLL) where the interest rate is tied to Peabody meeting social impact-based key performance indicators.

As disclosed by the parties - under the terms of the agreement, Peabody will benefit from a lower interest rate margin on the loan if it delivers an agreed number of accredited childcare qualifications under their Childcare Training Programme.  This target rises incrementally over the 5 year life of the loan.

Peabody will draw on the loan for general corporate purposes in their mission to provide affordable housing and will reinvest interest rate savings into the Peabody Community Foundation (PCF), which benefits thousands of Londoners every year and meets several UN Sustainable Development Goals (SDGs), including no poverty (SDG1), decent work and economic growth (SDG8), reduced inequality (SDG10), Sustainable cities and communities (SDG11), and partnerships (SDG17)."

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£100,000,000 sustainability-linked loan:

Addleshaw Goddard LLP acts for BNP Paribas as Agent and Arranger on £100,000,000 sustainability-linked loan with L&Q Housing Trust

Primary loan purpose: to develop and maintain much needed social and affordable housing

Sustainability/social impact metric: tackling tenant unemployment / social mobility

As reported in The Guardian: 

"Social housing residents are twice as likely to be unemployed compared with the UK population on average, according to research by the Institute for Public Policy Research (IPPR). Those who are in work are likely to be low-paid and in part-time jobs. The average weekly pay for housing association tenants is £250, compared to £232 for local authority tenants, £348 for private renters and £454 for owner-occupiers."

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"In addition to using the funds to help develop and maintain much needed social and affordable housing in London and the South East, L&Q Housing Trust benefits from an undisclosed margin reduction if it can help get 600 unemployed tenants back into work during the first year of the loan agreement, with that target rising by a further 25 each year during the life of the loan. L&Q's auditors PwC will monitor compliance with the metric.

L&Q Housing Trust aims to achieve this by working through its Independent Lives Programme to develop unemployed tenant's skills, employability and helping them to find work.  The costs saved by the margin reduction are used to develop even more social housing."