Project Details
Project
Wells Fargo Commercial Mortgage Trust 2024-SVEN Sustainable Finance Framework (2024)
Client
Wells Fargo Bank
Project Type
Sustainability Bond/Loan
Industry Group
Banks
Use of Proceeds
Green buildings; Affordable housing;
Location
U.S.
Evaluation Date
May 2024
Evaluation Summary
Sustainalytics is of the opinion that the Wells Fargo Commercial Mortgage Trust 2024-SVEN Sustainable Finance Framework is credible and impactful and aligns with the Sustainability Bond Guidelines 2021, Green Bond Principles 2021, and Social Bond Principles 2023. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds Green Buildings, Affordable Housing are aligned with those recognized by the Green Bond Principles and Social Bond Principles. Sustainalytics considers that investments in the eligible categories will lead to positive environmental or social impacts and advance the UN Sustainable Development Goals, specifically SDGs 9 and 11.
PROJECT EVALUATION AND SELECTION
The Depositor and Wells Fargo have selected the related mortgaged property, Sven, in accordance with the criteria under the Framework. The Borrower, together with two affiliates of the Durst Organization, which will maintain the operational control of the property, will evaluate the environmental and social risks associated with the project and implement related mitigation measures, in accordance with applicable laws and regulations. Sustainalytics considers the project selection process in line with market practice.
MANAGEMENT OF PROCEEDS
At the time of the issuance, all the net proceeds from the issuance of the Certificates will be immediately allocated to finance the Mortgage Loan, which will be used to refinance the Mortgaged Property. There will not be any unallocated proceeds after the funding of the Mortgage Loan and neither the Depositor nor the Trust will retain the flexibility to re-allocate the use of proceeds or have any temporary use of proceeds. This is in line with market practice.
REPORTING
The Depositor commits to include a description of the Mortgaged Property and certain sustainability features of it, in the initial offering and sale of the Certificates, within an offering circular. In addition, the Depositor will disclose relevant impact metrics to investors in the offering circular. There will not be continuous allocation and impact reporting due to immediate allocation at issuance. Sustainalytics views Wells Fargo’s allocation and impact reporting as aligned with market practice.