The European Bank for Reconstruction and Development will provide Dragon Capital with a $12.5 million loan to help the investment company develop sustainable real estate in Ukraine.
The EBRD loan will partly refinance the reconstruction of Grand Business Center, which has a rental area of 9,000 square meters in central Kyiv, and two warehouses Diana Lux Logistic in Kyiv and Terminal Kharkiv, which combined have a rental area of 26,000 square meters.
The loan will also stimulate construction of the new commercial and residential property and therefore create new jobs, Volodymyr Tymochko, the company’s managing director, told the Kyiv Post. “This is a good signal for all investors.”
Dragon Capital and its partners have invested over $600 million into real estate in Ukraine from 2016 to 2020. Some of Dragon Capital’s buildings have been certified as sustainable.
Grand Business Center, for example, in July 2020, became the first office building in Kyiv to receive a sustainability certificate under the Building Research Establishment Environmental Assessment Method, known as BREEAM, the world’s foremost environmental assessment method and rating system for buildings.
Since then, three other properties owned by the company have also been BREEAM-certified with a green building label. The goal is to make the total number eight by the end of 2021, Tomas Fiala, head of Dragon Capital, wrote in the press release.
The investment firm is also introducing “green paragraphs” into their lease agreements, whereby their tenants will be required to minimize the environmental footprint of the properties, using water and energy more efficiently.
The rest of the loan will be used in the commercial property sector, particularly in the development of two industrial parks in Kyiv and Lviv with a total size of 340,000 square meters, both of which the firm acquired in 2020.
“We are very pleased to start our cooperation with the EBRD in the area of sustainable property investments,” Fiala said.
The European bank is already at the forefront of the global efforts to combat climate change and protect the environment and has set a goal to devote over 50% of its annual investments in the green economy by 2025.
Ukraine is one of the top three investment destinations for the EBRD. The international financial institution has provided 2 billion euros (around $2.4 billion) to the country’s economy in the past two years.
