In 2019, Zug Estates was the first listed real estate company in Switzerland to issue a green bond. What was at the time a market trailblazer is now standard. Fact is, the market for green finance has seen strong growth since then; indeed, Zug Estates added additional green bonds in 2022 and 2024. The value of all three bonds now stands at CHF 300 million, with the Zug Estates bond portfolio consisting exclusively of green bonds.

To obtain greater flexibility in relation to green finance, Zug Estates in 2024 converted its Green Bond Framework – which prior to that had exclusively enabled the adoption of green bonds – into a Green Finance Framework and set out strict criteria for the selection of green projects. The new framework constitutes the basis for the raising or refinancing of green financing instruments such as bonds, loans, mortgages, hybrid bonds and insurance policies. This requires a description of ESG strategy, project evaluation, as well as the use and management of resources, together with an illustration of planned reporting. 

Via a Second Party Opinion (SPO), issuers or investors obtain independent external verification of their socially and environmentally sustainable bonds and loans. This ensures that financing instruments meet recognised standards such as the Green Bond Principles of the International Capital Market Association (ICMA) and the Loan Market Association (LMA). 

To provide total transparency for investors and other stakeholders, Zug Estates prepares and publishes an annual green finance report consisting of allocation and impact reporting. The allocation report deals with the use of funds, while the impact report shows the impact of the funds used on nature and the environment.

In its Green Finance Framework, the Zug Estates Group has set out sustainable selection criteria based around the UN Sustainable Development Goals (SDGs). Provided one of the following conditions is met, or is met following building completion, buildings or sites are considered for green financing or refinancing. 

• Greenhouse gas emissions for operations amount to less than 1kg per m² energy reference area (<1 kg CO₂eq / m² ERA p.a.) 
• The buildings or sites are certified by BREEAM (Very Good or higher), DGNB/SGNI (Gold or higher), SNBS (Gold or higher) or Minergie 

Despite these ambitious guidelines, the proportion of green properties at Zug Estates is 95% as measured by market value. The three green bonds taken up were allocated to the properties at the Suurstoffi site.

Going forward, Zug Estates will continue to pursue the environmentally sustainable development of its real estate portfolio and the attendant financing. We are forging ahead with transformation of the remaining 5% into green buildings and – together with our financing partners – are seeking additional, fitting solutions in the sustainable finance space.