Sustainability is a key cornerstone for Citycon to create long-term value for its investors and to the communities in which it operates.

In 2019 Citycon launched a Green Financing Framework which integrates the company’s sustainability targets with its financing activities. Under the Green Financing Framework, Citycon can issue Green Bonds, Green Commercial Papers, Green Loans, Green Hybrid Bonds or Green Private Placements. The framework was updated in March 2023 to reflect recent development in Green Financing practice and the company’s business. 

In 2020, the company increased the link between financing and its sustainability targets by signing a Sustainability-linked Revolving Credit Facility. The Facility was refinanced and expanded to include a term loan in 2023. Simultaneously, the sustainability targets linked to the facility were updated at a more ambitious level. 

In July 2023, Citycon was the first Finnish issuer to issue a Green Commercial Paper in the Finnish commercial paper markets. Citycon udpated its Finnish euro commercial paper program to Green format in July 2023, following this all Finnish euro commercial paper issued with a maturity date later than 30 September 2023 will be labelled as green.  

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Green Financing

Citycon’s Green Financing Framework is based on Citycon’s sustainability strategy that spans until 2030 with an aim of becoming carbon neutral by 2030. The framework reflects practices that support the transition to a sustainable and low carbon economy through the development of green assets. Key steps in achieving our climate ambitions, concretized by our carbon emission reduction targets are engagement with construction companies in the building process, energy efficiency measures in our buildings, increased use and production of renewable energy and an increased share of environmental certified and energy efficient buildings. 

Proceeds issued under the framework can therefore be used to finance or re-finance eligible green assets in categories green buildings, energy efficiency, clean transportation, renewable energy and waste management. As at June 30st, 2024, approximately EUR 2.7 billion of Citycon’s property portfolio was eligible for green (re)financing. Citycon’s Green Financing Framework is supported by a second opinion from Cicero and the company publishes an Allocation of Proceeds and Impact Report, along with a verification report from an external part, on an annual basis. Both documents are available below.

In addition to the annual report, Citycon publishes a quarterly update on the total amount of green assets in each category along with the total amount of outstanding green financial instruments. Quarterly updated figures can be found in the table below. Figures reported up until Q4/2022 are assessed in accordance with the framework that was released in 2019, and figures reported starting Q1/2023 are based on the requirements in the updated framework released in 2023. 

In July 2023, Citycon was the first Finnish issuer to issue a Green Commercial Paper in the Finnish commercial paper markets. Citycon udpated its Finnish euro commercial paper program to Green format in July 2023, following this all Finnish euro commercial paper issued with a maturity date later than 30 September 2023 will be labelled as green.  Citycon has issued green bonds and hybrid bonds since the launch of the green financing framework in 2019.

Green Bank Financing 

In 2023, Citycon has entered into mortgage debt financing and in November the company executed a SEK 1,020 million (approx. EUR 89.5 million) 7-year secured green term loan in Liljeholmstorget Galleria in Stockholm, Sweden. The term loan is not issued under the Green Financing Framework but is classified as green by the lending banks, based on the energy scoring model developed by the banks based on energy consumption levels, green building certificates and further sustainability criteria applied for assessing whether the properties financed under the loan meet the banks' criteria for financings qualifying as green. 

Sustainability linked Financing

The company has further increased the link between financing and its sustainability targets by signing its first Sustainability-linked Revolving Credit Facility in November 2020. In May 2023 Citycon refinanced its Sustainability-linked Credit Facility. In addition to the EUR 400 million Revolving Credit Facility, the facility was expanded with a EUR 250 million Term Loan, linking the margin on the total credit facility of EUR 650 million to achieving three of Citycon’s main environmental targets

  • Decreasing the Greenhouse Gas Intensity of the portfolio in line with the target of being carbon neutral by 2030
  • Decreasing energy consumption per square meter in line with achieving a 10% reduction by 2027 and 
  • Certifying the whole property portfolio according to BREEAM or LEED, with a minimum certification level of BREEAM Very Good or LEED Gold.

If Citycon meets all of the sustainability targets, measured annually in progress towards the set targets, there is a sustainability discount applied to the interest margin on the facility. On the contrary, if Citycon were to fail on all targets, the company would be obliged to pay a premium on the facility margin. The sustainability-linked margin thus further incentivizes the company to achieving its long-term sustainability targets.

Green Eligible Assets and Green Financing reported according to Citycon’s updated Green Financing Framework starting Q1/2023. The Green Financing Categories and Criteria have been updated to reflect the new framework.

Approved Eligible Assets Amount Green Financing (KEUR)Q2/2024Q1/2024Q4/2023Q3/2023Q2/2023Q1/2023
New Construction, investments made000000
Existing Buildings, Commercial2 661 7732 828 759
 
2 534 294
 
2 436 4582 444 2552 256 753
Existing Buildings, Residential72 19275 50046 705
 
000
Energy efficiency12 87912 75512 945
 
13 98713 27513 401
Clean transport979797979797
Renewable Energy777777777777
Waste Management000000
Total approved Eligible Green Assets2 747 0182 917 188
 
2 594 118
 
2 450 6192 457 7032 270 328
Green Hybrid Bonds612 860612 860612 860
 
654 890655 590656 490
Green Bonds644 500644 500344 500
 
415 589413 253420 212
Green Commercial paper 44 00044 67747 000
 
13 50000
Outstanding green financing, nominal amount total1 301 3601 302 0371 004 360
 
1 083 9791 068 8431 076 702
Remaining approved Eligible Green Assets1 445 6581 615 1511 589 758
 
1 366 6401 388 8611 193 626

Green Eligible Assets and Outstanding Debt reported according to Citycon’s Green Financing Framework 2019−2022.

Approved Eligible Asset Amount Green Financing (KEUR) Q4/2022 Q3/2022 Q2/2022 Q1/2022    Q4/2021 Q3/2021 Q2/2021 Q1/2021 Q4/2020 Q3/2020 Q2/2020 Q1/2020
New Construction, investments made 0 0 0 0 342 708 312 102 287 124 241 951 219 648  181 978 157 017 143 223
Existing Buildings 2 318 874 3 138 097 3 165 837
 
 
3 211 063 2 923 158 2 939 503 2 936 334 2 940 964 2 731 859 2 667 066 2 690 780 2 447 628
Energy efficiency, Energy retrofits 12 451 11 872 11 861
 
11 256 11 100 10 087 10 012 9 927 9 492 8 015 4 279 4 000
Energy efficiency, Activities enabling clean transport 97 97 97
 
80 80 112 112 112 112 112 112 112
Renewable Energy 77 1 323 1 317 1 404 1 365 1 341 1 340 1 364 1 302 1 228 1 249 1 184
Total approved Eligible Green Assets 2 331 499 3 151 389 3 179 112
 
3 223 804 3 278 411 3 263 145 3 234 923 3 194 318 2 962 414 2 858 399 2 853 437 2 596 147
Outstanding green financing, nominal amount 1 126 090
 
1 127 649 1 127 306
 
1 132 381 1 130 090 1 128 701 1 128 650 780 036 426 407 350 000 350 000 350 000
Remaining approved Eligible Green Assets 1 205 408
 
2 023 740 2 051 806
 
2 091 423 2 148 322 2 134 444 2 106 273 2 414 282 2 536 007 2 508 399 2 503 437 2 246 147