The Green Home Maker

Unión de Créditos Inmobiliaros (‘UCI’), a Santander and BNP Paribas joint-venture, issued a €385 sustainable Residential Mortgage-Backed Security (‘RMBS’) deal secured by owner-occupied residential properties in Portugal and Spain to meet the accelerating transition to a low carbon economy and escalating demand for environmentally sustainable residential buildings. UCI launched Green Belem No. 1 (‘Green Belem’) as a means of meeting ambitious environmental performance criteria for the residential housing stock. Green Belem has mechanisms to embed environmental sustainability into lending activities focused on the retrofit, rehabilitation, renovation and refurbishment of single-family detached and multi-family residential properties. UCI is developing real finance product sets with property-level incentives that progressively increase as a building’s carbon intensity decreases.

UCI has established a Green Bond Framework for the issuance of green finance instruments, including green bonds, green private placements and green loans. UCI expects to allocate €47.5m to its green residential real estate finance product-sets, of which 93.7% will be in Spain and the remainder in Portugal. The lender targets an increase of 73.3% in the amount of proceeds allocated to its green range of products, or green investments, between 2020 and 2025. The total is expected to be €325m, mainly focusing on the green acquisition and refurbishment (of single-family detached and multi-family residential properties), which represents 76.9% of the funds committed. Over the five-year period, 94.3% of the proceeds are due to be allocated to projects located in Spain and 5.7% in Portugal.