Gewobag Wohnungsbau-Aktiengesellschaft Berlin („Gewobag“) has successfully issued its first social bond on the capital markets in the total amount of EUR 500 million. The bond has a term of 6 years and an annual interest rate of 0.125 per cent. Investor interest in the offering was strong, with the orderbook 2.8x oversubscribed, underlining the attractiveness and sustainability of Gewobag’s social business model.
As Markus Terboven, member of the board of Gewobag, highlights, „The very successful first time bond offering of Gewobag at attractive terms is a continuation of our prudent and diversified financing strategy. The strong interest in the offering showcases that investors want to participate in our social business model. With the proceeds we will be able to further deliver on our promise to provide affordable housing for broad segments of the population of Berlin.“
Gewobag is a pure-play social housing company and intends to allocate an amount equal to the net proceeds to Eligible Social Assets, which contribute to affordable housing. As a result, Gewobag will continue to be one of the key players in providing affordable housing in Berlin.
The bond was issued under Gewobag’s newly established debt issuance programme, which will allow the company flexible access to the debt capital markets in the future. Moody’s has assigned an A2 rating to the notes, a testament to the strong credit quality of Gewobag.
J.P. Morgan was arranger of Gewobag’s DIP. Capstan Corporate Finance provided comprehensive advice to Gewobag in connection of the establishment of the facility.