Ayala Land raises P15-B green funds

Ayala Land Inc. (ALI) is set to raise up to P15 billion through sustainability-linked bonds (SLBs) — a type of financing where interest rates are tied to the company meeting specific environmental goals.

This move follows ALI’s securing of a green loan from the International Finance Corporation (IFC), which aims to fund projects certified under the EDGE Zero Carbon program. The program measures energy efficiency and carbon reduction in buildings.

The listed property developer will offer two tranches: a five-year Series C due 2030 and a 10-year Series D due 2035. Investors may place reservations until 29 September 2025, ahead of the interest rate setting on 30 September. The public offer period will run from 3 to 9 October, with issuance and listing on the Philippine Dealing & Exchange Corp. scheduled for 23 October.

Proceeds from the bond sale will be used for capital expenditures and debt refinancing. ALI will pay interest quarterly, with final coupon rates to be set at pricing.

Early broker guidance pegs returns at 6.0403 to 6.3403 percent for the five-year bonds and 6.2953 to 6.7953 percent for the 10-year series.

Climate goals

The SLBs are linked to Ayala Land’s climate targets, including a 42-percent cut in greenhouse gas emissions by 2030 and the certification of 1.5 million square meters of projects under the IFC EDGE Zero Carbon program by 2025. Investors will receive a five-basis-point step-up in coupon if the company fails to meet performance targets.

The issuance comes on the heels of ALI’s deal with IFC for a P12.87-billion sustainability-linked loan, which will partly fund the redevelopment of Greenbelt 1 in Makati and the development of Ayala Malls Evo City in Cavite. IFC is also working with ALI to roll out its Building Resilience Index across 50 of the company’s properties to assess climate and disaster preparedness.

While the IFC loan and the bond issuance are separate transactions, both are anchored on ALI’s broader push to diversify funding sources while aligning its growth with sustainability goals.