Aviva Investors commits to £1 billion of climate transition loans into real estate by 2025

(London) – Aviva Investors, the global asset management business of Aviva plc (‘Aviva’), has announced a commitment to originating £1 billion in sustainable transition real estate debt over the next four years, supported by the launch of its proprietary Sustainable Transition Loans Framework.

The Framework will be used by Aviva Investors to seek out sustainable real estate loan investment opportunities in line with the United Nations Sustainable Development Goals. It will focus on key sustainability targets such as energy efficiency and green initiatives including on-site renewables. Vigeo-Eiris (“V.E”), the ESG rating and research agency, has provided second-party verification and accreditation for the framework, to ensure that the loans comply with the LMA’s sustainability-linked loan principles.

As part of the initiative, Aviva Investors will embed measurable ESG commitments into its lending programme, setting out specific requirements for real estate borrowers to adhere to, in order to reduce carbon emissions from buildings, as it continues to support the transition to a low-carbon economy.

Gregor Bamert, Head of Real Estate Debt at Aviva Investors, said:

“We believe that by directly linking long-term financial incentives to measurable improvements in the environmental performance of the buildings we lend against, we can incentivise and engage borrowers to consider sustainability factors in a more meaningful way. Our target of originating £1 billion of sustainable transition loans reflects a commitment to reducing the carbon footprint of our clients’ portfolios.”

Through the framework and loans programme, Aviva Investors will instil long-term sustainability-linked incentives for borrowers, to ensure measurable environmental and energy improvements on buildings it lends against. Borrowers can benefit from a marginal reduction in the cost of debt, awarded when predetermined sustainability improvements have been made.

Ed Dixon, Head of ESG, Real Assets, at Aviva Investors, said:

“Our new proprietary framework is designed to specifically address the climate transition of buildings, which is an area of increasing focus across the real estate market. This is a critical challenge in the fight against climate change, with the built environment responsible for over 40 per cent of carbon emissions globally. We are thrilled to have the support of V.E as part of this initiative, who will independently verify our framework to ensure a consistent industry best-practice standard is adhered to.”

Benjamin Cliquet, Head of Sustainable Finance Business Development at V.E , commented:

“With this Sustainable Transition Loan Framework, Aviva Investor is adopting a supportive approach towards sustainable finance. It shows their willingness to engage their clients in improving the environmental performance of buildings, thus contributing to global efforts to fight against climate change.”

The commitment follows a £154 million refinancing provided by Aviva Investors to CLS Holdings in September, with the facility structured to include KPIs explicitly linked to sustainability targets, including a reduction in margin on the loan dependent on meeting specific targets assessed annually throughout the life of the facility.

Gregor Bamert added:

“We see this as a win-win situation. As borrowers meet these requirements, they will benefit from more favourable terms on their financing agreement, whilst our investors gain reassurance that the assets we lend against are more resilient to physical and transition climate risks and with a lower environmental impact. Ultimately this should result in better outcomes for all.”

-ENDS-

Sustainable Transition Loans

Buildings are responsible for around 40% of energy consumption and 36% of CO2 emissions in the EU, and almost 75% of the building stock is inefficient.* In order to accelerate the transition of these buildings.

 Aviva Investors has developed a proprietary framework for Sustainable Transition Loans for Commercial Real Estate.

Read more
ai sustainable transition

For more information contact:

A picture of James Morgan

James Morgan

Media Relations Manager

A picture of Steve Ainger

Steve Ainger

Head of Media Relations

A picture of Rob Davies

Rob Davies

Director of Investment and Client Communications

Important information

The information and opinions contained in this document are for use by the financial press and media only. No reliance may be placed for any purpose on the information or opinions contained in this document nor should they be seen as advice. 

The press release is provided on the basis that Aviva Investors Global Services Limited is not causing the communication of a financial promotion under exemption of the Financial Promotion Order, as Aviva Investors Global Services Limited has no control over the way in which an article based on this press release is prepared and published by the financial press and media. 

Except where stated as otherwise, the source of all information is Aviva Investors Global Services Limited (“Aviva Investors”) as at 11 April 2022. Unless stated otherwise any views, opinions expressed are those of Aviva Investors. They should not be viewed as indicating any guarantee of return from an investment managed by Aviva Investors nor as advice of any nature.  The value of an investment and any income from it may go down as well as up and the investor may not get back the original amount invested. 

Issued by Aviva Investors Global Services Limited, registered in England No. 1151805. Registered Office: St Helen's, 1 Undershaft, London, EC3P 3DQ   Authorised and regulated by the Financial Conduct Authority.

Aviva Investors

Aviva Investors is the global asset management business of Aviva plc. The business delivers investment management solutions, services and client-driven performance to clients worldwide. Aviva Investors operates in 14 countries in Asia Pacific, Europe, North America and the United Kingdom with assets under management of £268 billion in assets under management as at 31 December 2021.

Aviva PLC

We are the UK’s leading Insurance, Wealth & Retirement business and we operate in the UK, Ireland and Canada. We also have international investments in Singapore, China and India.

  • We help our 18.5 million customers make the most out of life, plan for the future, and have the confidence that if things go wrong we’ll be there to put it right.
  • We have been taking care of people for 325 years, in line with our purpose of being ‘with you today, for a better tomorrow’. In 2021, we paid £30.2 billion in claims and benefits to our customers.
  • Aviva is a market leader in sustainability. In 2021, we announced our plan to become a Net Zero carbon emissions company by 2040, the first major insurance company in the world to do so. This plan means Net Zero carbon emissions from our investments by 2040; setting out a clear pathway to get there with a cut of 25% in the carbon intensity of our investments by 2025 and of 60% by 2030; and Net Zero carbon emissions from our own operations and supply chain by 2030.  Find out more about our climate goals at www.aviva.com/climate-goals and our sustainability ambition and action at www.aviva.com/sustainability
  • Aviva is a Living Wage and Living Hours employer and provides market-leading benefits for our people, including flexible working, paid carers leave and equal parental leave. Find out more at www.aviva.com/about-us/our-people/
  • At 31 December 2021, total Group assets under management at Aviva Group are £401 billion and our Solvency II shareholder capital surplus is £13.1 billion. Our shares are listed on the London Stock Exchange and we are a member of the FTSE 100 index.
  • For more details on what we do, our business and how we help our customers, visit www.aviva.com/about-us  
  • The Aviva newsroom at www.aviva.com/newsroom includes links to our spokespeople images, podcasts, research reports and our news release archive. Sign up to get the latest news from Aviva by email.
  • You can follow us on:

o    Twitter: www.twitter.com/avivaplc/  

o    LinkedIn: www.linkedin.com/company/aviva-plc

o    Instagram: www.instagram.com/avivaplc

For the latest corporate films from around our business, subscribe to our YouTube channel: www.youtube.com/user/aviva

Aviva Investors Global Services Limited

St Helen's, 1 Undershaft, London, EC3P 3DQ  Phone     +44 (0)20 7809 6000

Fax          +44 (0)20 7489 7940

Web        www.avivainvestors.com

Email      info@avivainvestors.com

Issued by Aviva Investors Global Services Limited, registered in England No. 1151805. 
Registered Office:  St Helen's, 1 Undershaft, London, EC3P 3DQ.  Authorised and regulated by the Financial Conduct Authority and a member of the Investment Association.

Telephone calls may be recorded for training and monitoring purposes.