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Banks

  • EDGE certificates can be provided directly to Banks' buyers as proof of delivery on the developer’s promise to build green.

Banks now offer preferred financing rates for property developers and green mortgages for home buyers with EDGE-certified buildings.

Property developers are beginning to benefit from incentivized financing offered by forward-thinking banks  who are encouraging the construction sector to design better performing buildings. These banks offer incentivized financing to developers for projects that are certified green at the design stage with EDGE and other leading certification systems. In turn, banks benefit from owning a portfolio of green assets with greater value and less risk.

Qualified home buyers can then purchase EDGE-certified properties with green mortgages, where home improvement costs are folded into larger loans. Green mortgages are a win-win, as banks book lower risk loans, while buyers enjoy increased purchase power to pay for features that lower utility bills. As more banks join the trend, developers and buyers can take advantage of increasingly competitive offers, creating a new era where conventionally-built homes become obsolete.

Case Study: Bancolombia pivots the Colombian residential market towards a more sustainable future by rewarding green development.

Bancolombia, which is Colombia’s largest commercial bank, provides a construction financing rate of up to 1 percent less than market rates for projects certified with EDGE or other leading certification systems. The more measurably green the project is, the better the rate that is given to developers. At the same time, Bancolombia offers green mortgages to qualifying home buyers who purchase EDGE-certified properties at a discounted rate of 65 basis points for the first seven years of the loan. To do this, the bank uses its own resources alongside the proceeds of a pair of green bonds.

Qualifying projects must receive a preliminary design certificate from a rating system such as EDGE, with certification services provided by CAMACOL. Dozens of projects have been brought forward by developers eager to secure the discounted rate from Bancolombia. Davivienda, another leading bank in Colombia that has issued a green bond, now offers discounted financing as well, in addition to paying for a portion of EDGE certification fees. The insurance company, SURA, also offers a partial refund on construction and compliance insurance for EDGE-certified projects.

“Our financial services are linked to a positive transformation of society,” says Franco Piza, the Corporate Director of Sustainability for Bancolombia, which recently won the title of “the most sustainable bank in the world” by the Dow Jones Sustainability Index. “It’s our responsibility to offer products and services to reach new markets, lower risk and improve rates. The first order of business is profits for our clients through better assets, the second is protecting the environment.”

Builders who certify their buildings green can take advantage of valuable incentives offered by innovative banks and financial services companies in emerging markets.

Select a country that interests you to discover the incentives being offered by banks and insurance companies who are making a difference in shaping their future built environments. You can also download the Banking Incentives for EDGE chart.

Colombia – Davivienda

Bank:

Davivienda

Country:

Colombia

Building Typology:

Residential and Mixed Use

Incentive:

Reduction of a maximum of 100 basis points for residential and mixed-use buildings, in addition to covering 50% of the cost of EDGE certification (up to 15 million pesos COP).

Currency:

COP

Term:

N/A

Grace Period:

N/A

Front End Fee:

N/A

Available Certification Systems:

BREEAM, EDGE, LEED

Website:

www.davivienda.com

Contact:

Nancy Motta at nmotta@davivienda.com or +33 00000, ext. 53010

Colombia – SURA

Insurance Company:

SURA

Country:

Colombia

Building Typology:

Residential and Commercial

Incentive:

10% of the premium for SURA construction and compliance insurance is refunded to policy holders for EDGE-certified projects, valid through December 2019.

Available Certification Systems:

EDGE

Website:

www.segurossura.com.co

Contact:

Mauricio Alejandro Lozano at mlozano@sura.com.co or +57 301 6936365

Costa Rica – Banco Promerica

Bank:

Banco Promerica

Country:

Costa Rica

Building Typology:

Residential and Mixed Use

Incentive:

8.75% green construction financing rate compared to a normal rate of 9.25%

Currency:

USD$

Term:

Four years compared to a normal term of three years

Grace Period:

24 months compared to a normal grace period of 18 months

Front End Fee:

.75% compared to a normal front end fee of 1%

Available Certification Systems:

EDGE, LEED GOLD, LEED PLATINUM, LEED SILVER (if demonstrates 20% savings)

Website:

www.promerica.fi.cr

Contact:

Gustavo Calderon at gucalderon@promerica.fi.cr or +506 2505-7124

Ecuador – Banco Pichincha

Bank:

Banco Pichincha

Country:

Ecuador

Building Typology:

Residential and Mixed Use

Incentive:

Free EDGE certification for smaller projects and free EDGE Expert, EDGE Auditor, and EDGE certification for larger projects. All qualifying projects receive free training on the EDGE App and certification process. Market rates of 8.95% to 11.23% apply.

Currency:

USD$

Term:

Up to 28 months (normal term)

Available Certification Systems:

BREEAM, EDGE, LEED

Website:

www.pichincha.com

Contact:

Carla Dueñas at cduenas@pichincha.com

Global Climate Partnership Fund

Fund:

Global Climate Partnership Fund (GCPF)

Building Typology:

Residential and Commercial

Incentive:

100% coverage of EDGE Expert and EDGE Auditor fees for the projects of GCPF partner institutions that meet GCPF’s eligibility criteria.

Available Certification Systems:

EDGE

Website:

www.gcpf.lu

Contact:

David Mazaira at david.mazaira@responsability.com

EDGE satisfies a gap in the market for a metrics-driven solution supported by the investment community, that helps to accelerate green buildings through green bonds.

Investors want to be confident that a green building will deliver operationally. EDGE certification meets this need with its minimum standard of 20 percent less energy, water and embodied energy in materials, as calculated through the EDGE software and verified by third-party certifiers. Financial institutions are responding by adopting EDGE as eligibility criteria for their construction pipelines, including Bancolombia, CDC, Davivienda, EBRD, FMO, IDB, KfW and Proparco. EDGE continues to be intrinsic to IFC’s own business, with nearly $4 billion in direct investment and mobilization in green buildings within the past five years.

With green bond issuance growing a steady 4% year-over-year to $162 billion (according to the Climate Bonds Initiative) a measurable solution is essential to qualify green buildings. Green bonds have typically supported renewable energy projects, but with EDGE, now green buildings can better capitalize on the investment trend.