Residential property group Heimstaden Bostad, through its subsidiaries Heimstaden Czech s.r.o and Heimstaden Czech Pilsen s.r.o, has secured a sustainability-linked bank financing of €700 mln.
UniCredit Bank, acting as mandated lead arranger and sustainability coordinator, has alongside Ceska Sporitelna, Ceskoslovenska obchodni banka, European Bank for Reconstruction and Development (EBRD), Intesa Sanpaolo, Komercni banka, Raiffeisenbank, and Vseobecna uverova banka provided financing for the project.
The funds will be used for liability management and to support sustainability investments such as thermal insulation, installation of heat pumps, and renewable fuel shift in Heimstaden Bostad's Czech residential properties.
CEO Helge Krogsbøl commented: 'We are pleased to announce our cooperation with EBRD, UniCredit, and the Czech banking consortium. These funds strengthen our balance sheet and will enhance the sustainability of our Czech portfolio. Heimstaden Bostad was the first major European residential real estate company to attain Science Based Targets initiative (SBTi) validation for our Climate Roadmap, with our Czech portfolio offering the highest potential for reducing CO2 emissions.'
Earlier this week the Stockholm-headquartered residential giant strengthened its management team with the appointment of chief investment officer, Christian Fladeland as deputy CEO of the firm.
Fladeland recently told Reuters that the firm's board was examining options including 'the evaluation of capital injections and strategic privatisations of the portfolio' to shore up its balance sheet.
Like other developers, the high interest rate environment, steep construction costs and labour shortages have narrowed the firm's margins. Paired with significant leverage and falling house prices, Heimstaden is in need of cash, according to shareholders.