Project Details
Project
Freddie Mac Multifamily Sustainability Bonds Framework Second-Party Opinion
Client
Freddie Mac Multifamily
Project Type
Sustainability Bond/Loan
Industry Group
-
Use of Proceeds
-
Location
U.S.
Evaluation Date
Sep 2020
Evaluation Summary
Sustainalytics is of the opinion that the Freddie Mac Multifamily Sustainability Bonds Framework (“Framework”) is credible, impactful and aligns with the Sustainability Bond Guidelines 2018. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds are aligned with those recognized by both the Green Bond Principles and Social Bond Principles. Sustainalytics considers social and environmental projects related to the areas of Affordable Housing, Socio-Economic Advancement, Energy Efficiency, Green Buildings, and Transit-Oriented Development to have positive environmental or social impacts and advance the UN Sustainable Development Goals, specifically Goals 1, 7, 10 and 11.
PROJECT EVALUATION/SELECTION
Freddie Mac will select and evaluate projects in line with its existing policies and procedures for risk management and underwriting. Freddie Mac will be responsible for conducting all underwriting and credit reviews. Loans intended to be securitized are underwritten to the same standards as loans that are to held in its investment portfolio. Sustainalytics considers the project selection process to be in line with market practice.
MANAGEMENT OF PROCEEDS
Sustainability bonds proceeds will be managed in accordance with Freddie Mac’s existing policies for capital management. The funds raised under the Framework have been or will be used exclusively for activities that meet the eligibility criteria, and to which Freddie Mac intends to allocate all of the proceeds accordingly. This is in line with market practice.
REPORTING
Freddie Mac intends to provide investors with both asset-and-portfolio level reporting on an annual basis. Portfolio-level performance data will take into consideration financial factors as well as environmental and social impacts. Freddie Mac will publish all relevant information associated with bond issuances under the Framework on its website. Sustainalytics views Freddie Mac Multifamily’s allocation and impact reporting as aligned with market practice.