DEALS
Zhong Lun Assists the Successful Issuance of the Largest CMBS (Carbon Neutrality) in China
Zhong Lun Assists the Successful Issuance of the Largest CMBS (Carbon Neutrality) in China
Zhong Lun recently assisted Shanghai Jinmao Investment Management Group Co., Ltd. in the successful establishment of “CITIC Securities – Jinmao Kaichen 2022 Green Asset-Backed Special Scheme (Carbon Neutrality)" (the “Scheme") at the Shanghai Stock Exchange. The Scheme is a renewal of the “CICC – Jinmao Kaichen 2019 Asset-Backed Special Scheme", and through the transactions sophisticatedly designed, an effective and smooth transition between the two special schemes has been achieved. As the largest carbon neutral CMBS in China so far, the Scheme adopted single SPV model as its structure, and its renewal arrangement serves as a fine example for other CMBS and quasi-REITs in the market. The Scheme plays an important role as a model for subsequent securitization in domestic real estate area.
Against the background of China’s national dual carbon goals of “emissions peak, carbon neutrality", Shanghai Jinmao Investment Management Group Co., Ltd., as the original equity owner, actively promoted the establishment of the Scheme, showing its strong sense of social responsibility and firm resolve to take action as a well-known state-owned enterprise and an urban operation platform. Designed and built in accordance with green architecture standards, the underlying asset, “Kaichen World Trade Center", has been rated a three-star green building and achieved LEED Platinum and WELL Gold certifications. The scale of the Scheme is RMB 8.708 billion, including RMB 8.707 billion senior securities, with a senior issuance interest rate of 3.4%.
Zhong Lun acted as legal counsel on the deal, providing full-process services covering due diligence investigation, analyzing transaction proposal and feasibility, assisting in communicating with regulatory authorities, drafting transaction documents, issuing legal opinions, etc. Borong Liu and Wei Xu were the lead partners of the Scheme and team members also included Xiang Zhang, Min Li, etc. The Scheme’s success speaks volumes for the rich experience and solid track records of Zhong Lun in real estate and securitization, especially the firm’s unique competitive edge in the niche sector where securitization is backed by real properties.
