Red Sea Global secures SAR 14.120 billion loan and first ever Riyal-denominated Green Finance credit facility
The Red Sea Project achieves Green Financing accreditation thanks to standard setting approach to regenerative tourism
Riyadh, (27 April 2021): Red Sea Global RSG (formerly known as TRSDC) , the developer behind the world’s most ambitious regenerative tourism project, announced today that it has closed a SAR 14.120 billion (USD 3.76 billion) term loan facility and revolving credit facility with four Saudi banks.
Banque Saudi Fransi, Riyad Bank, Saudi British Bank and Saudi National Bank acted as Mandated Lead Arrangers. HSBC served as Green Loan Coordinator on the transaction.
Green Financing accreditation was awarded due to RSG’s market leading approach to social and environmental sustainability and the Red Sea Project’s international recognition as a green project. The financing is the first Riyal-denominated credit facility to receive Green Financing accreditation.
The scale of this project is unmatched anywhere in the world and we are setting new standards in regenerative tourism at every turn. By applying a unique approach to design, utilizing more sustainable methods of construction and using groundbreaking technology, we are not only reducing our impact on the environment but helping to deliver on our commitment to achieve a 30 percent net conservation benefit by 2040. It is this pioneering approach that has helped us secure the first ever Riyal-denominated Green Finance credit facility,
Said John Pagano, Group CEO of RSG.
Jay Rosen, Chief Financial Officer at RSG, said: “This is another milestone for the Red Sea Project and Vision 2030, and we are pleased to have secured our debt financing and capital commitment for our initial phase. This financing adds another level of credibility by having the banks support the project. With a fully secured capital structure our project will become more attractive to investors.”
The Green Financing accreditation is governed by a Green Financing Framework aligned with the Green Bond Principles (2018) and Green Loan Principles (2020) set out by the International Capital Markets Association (ICMA) and the Loan Market Association’s (LMA) respectively. The framework enables RSG to issue green loans and other green financial instruments and allows RSG to identify, select, manage and report on eligible projects and assets in line with principles. DNV provided an independent, Second Party Opinion on RSG’s Green Finance Framework, confirming its alignment with these internationally recognized principles.
Through this credit facility, the four participating banks are demonstrating their Environmental, Social and Governance (ESG) credentials, while RSG is able to establish itself as a world-leader in sustainable development.
We aim to lead the international luxury tourism industry’s transformation into a more sustainable model, including environmental and social sustainability. This Green Finance classification is the latest proof that we are setting new standards in ecotourism and showing the industry that things can be done in a different way both here in the Kingdom, and globally,” said Mr. Pagano.
The Red Sea Project has already passed significant milestones and work is on track to welcome the first guests by the end of 2022, when the international airport and the first hotels will open. Phase one, which includes 16 hotels in total, will complete in 2023.
Upon completion in 2030, The Red Sea Project will comprise 50 resorts, offering up to 8,000 hotel rooms and more than 1,000 residential properties across 22 islands and six inland sites. The destination will also include luxury marinas, golf courses, entertainment and leisure facilities.
About Red Sea Global
Red Sea Global (RSG - www.redseaglobal.com) is a closed joint-stock company wholly owned by the Public Investment Fund (PIF) ofSaudi Arabia.
RSG is a global multi-project developer, seeking to lead the world towards a more sustainable future, showing how responsible and regenerative development can uplift communities, drive economies, and enhance the environment. The protection of natural capital is central to all development decisions, as the organization seeks to create abetter future for all.
A cornerstone of Saudi Arabia’s Vision 2030 ambition to diversify its economy, RSG is playing a key role in transforming the nation, by creating exciting opportunities for young Saudi talent and the private sector, as it develops built assets and destinations across multiple sectors that make a positive impact for people and planet.
RSG is the visionary company behind some of the world’s most ambitious development ventures, including luxury regenerative tourism destinations such as The Red Sea and AMAALA.
Across its portfolio, RSG leverages the most innovative concepts, strategies, and technologies to deliver projects that actively enhance the wellbeing of customers, communities, and environments.