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Far East Hospitality Trust has secured a SGD 101.4 million sustainability-linked facility with an institutional bank, marking a significant step in integrating ESG targets with financial operations. The facility links borrowing costs to the achievement of sustainability benchmarks, supporting energy efficiency, carbon reduction, and responsible practices across its portfolio. This move reflects a broader trend among Singaporean and regional REITs, which increasingly adopt sustainability-linked financing to enhance operational flexibility and align with investor expectations. By combining financial strategy with environmental responsibility, the trust is reinforcing its commitment to sustainable growth in the hospitality sector.
Far East Hospitality Trust has entered into a SGD 101.4 million sustainability-linked facility agreement with an institutional bank, highlighting the trust's ongoing commitment to sustainable operations. The facility is structured to align borrowing costs with the achievement of predefined environmental, social, and governance (ESG) targets, reflecting a growing trend among Singaporean real estate investment trusts to integrate sustainability into their financing strategies. Advertisement
The move comes as part of Far East Hospitality Trust's broader efforts to strengthen its financial flexibility while supporting environmentally responsible practices across its portfolio. The trust, which manages a diverse range of hospitality assets, aims to leverage the facility to fund operations and projects that promote energy efficiency, carbon reduction, and other sustainability initiatives.
Industry observers note that sustainability-linked financing is increasingly preferred by REITs in Asia, as it provides incentives for meeting ESG objectives while ensuring access to competitive financing. Far East Hospitality Trust's decision to adopt such a facility aligns with similar measures taken by regional peers in the hospitality sector over the past few years, signaling an ongoing shift in capital markets toward sustainability-driven lending.
Source Reuters
5th Jun, 2025
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