Project Details
Project
Century Housing Corporation Sustainability Bond Framework Second-Party Opinion
Client
Century Housing Corporation
Project Type
Sustainability Bond/Loan
Industry Group
Banks
Use of Proceeds
Affordable housing; Energy efficiency;
Location
U.S.
Evaluation Date
Jun 2020
Evaluation Summary
Sustainalytics is of the opinion that the Century Housing Corporation (“Century”) Sustainability Bond Framework (“Framework”) aligns with the four core components of the International Capital Markets Association’s Sustainability Bond Guidelines 2018. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds, Affordable Housing, Green Buildings & Energy Efficiency and Transit Oriented Development are aligned with those recognized by both the Green Bond Principles and Social Bond Principles. Sustainalytics considers that the eligible categories will lead to positive environmental and social impacts and advance the United Nations (“UN”) Sustainable Development Goals (“SDGs”), specifically SDGs 1, 7, 10 and 11.
PROJECT EVALUATION/SELECTION
Century’s loan policies require the selection of projects which are in compliance with the eligibility criteria using its existing loan approval policies. The legal requirements of Century’s federal and state exemptions require that all loans be made for the purpose of affordable housing as defined in the Framework. Sustainalytics considers the project selection process to be in line with market practice.
MANAGEMENT OF PROCEEDS
Upon issuance, Century intends to allocate 100% of the proceeds from its bond offerings to its affordable housing lending operations. This will be carried out by funding new loans as well as refinancing existing debt. In this context, no commitments for ongoing management are required. The application of the proceeds will be tracked in accordance with Century’s internal corporate accounting systems. Sustainalytics considers this to be in line with market practice.
REPORTING
Century intends to provide allocation and impact reporting on its website on an annual basis, until full allocation. Allocation reporting will include the share of loans used for new housing compared to retrofitting existing affordable homes and the share of financing allocated to green criteria compared to social criteria. Impact reporting will draw on several relevant quantitative and qualitative metrics. Sustainalytics views Century’s allocation and impact reporting as aligned with market practice.