- M&G European Property Fund issued its first €500 million green bond, M&G plc said.
- The bond attracted significant investor interest, with peak orders exceeding €2.1 billion, M&G plc reported.
- Proceeds will fund new investments and green projects, enhancing the portfolio's sustainability, M&G plc stated.
LONDON, United Kingdom — M&G plc's M&G European Property Fund has successfully issued a €500 million green bond.
M&G plc said in an emailed press release today that the issuance provides additional capacity for investment, acquisitions, and refinancing for the €5.4 billion fund.
Strong Investor Demand
The green bond attracted strong demand from a broad international investor base. Peak orders for the bond exceeded €2.1 billion from more than 120 investors. The issuance was 2.8 times oversubscribed at final pricing.
This demand allowed the fund to secure five-year financing terms at a margin of 100 basis points. The fund's Green Finance Framework received an 'Excellent' assessment from Sustainable Fitch. Fitch Ratings also assigned an 'A-' Issuer Default Rating.
Fund Strategy and Use of Proceeds
The M&G European Property Fund is M&G's flagship Continental European core diversified real estate strategy. It invests across offices, logistics, retail, and living sectors in 12 European markets. The fund has been investing in high-quality assets for 20 years.
Proceeds from the green bond will fund new investment opportunities and eligible green projects. This aims to enhance the sustainability, efficiency, and long-term value of the portfolio. The fund has committed to over €1 billion in acquisitions across 11 transactions in the past 12 months, primarily in the logistics and living sectors.
Simon Ellis, Fund Manager for the M&G European Property Fund, said the bond marks an important milestone. He noted it supports the fund's ambition to build on recent acquisitions. Sally Hurst, Director, Debt Strategy & Origination at M&G Real Estate, stated the issuance establishes a new source of long-term funding and broadens financing options.