To support sustainable development and advance Indonesia’s journey to a low-carbon future, the International Finance Corporation (IFC) has announced its first sustainability-linked loan in the country, which will be used to expand green building certification of the portfolio of PT Nirvana Wastu Pratama (NWP), a leading retail and logistics property platform.

IFC said in a statement on last Thursday that it has invested equally alongside PT Bank OCBC NISP in a $53 million sustainability-linked loan with an 11-year tenure to NWP.

The proceeds will support the company in decarbonizing its property portfolio by improving energy efficiency, reducing greenhouse gas (GHG) emissions, and achieving green-building certification through IFC’s internationally acclaimed EDGE program.

IFC’s partnership with NWP will deliver clear technical guidance on establishing and meeting sustainability performance targets, refining its sustainability-linked finance framework to align with IFC’s green building and investment standards.

The loan is tied to two specific sustainability performance targets.

Assets that have been in operation for more than three years need to achieve an absolute emissions reduction target of 42 percent by 2030 as compared to the 2019 benchmark.

New building projects or projects undergoing major retrofitting need to achieve EDGE Advanced certification.

NWP has been an early adopter of the EDGE green-building tool and certification program in Indonesia.

Since 2017, the company has secured EDGE certifications for eleven assets, with six more registered for certification by 2027.

“Working with IFC is a significant milestone which exemplifies our commitment to sustainability,” said Kevin Kow, Chief Executive Officer & President Director of NWP.

“IFC’s support will not only help us to adopt greener building practices but also to set a new benchmark for the industry in Indonesia,

“We are confident that this joint effort will significantly cut greenhouse gas emissions in our projects and benefit the economic development of local communities,” he added.

The building and construction sector plays a key role in Indonesia’s economic and sustainable development.

However, it is also a significant source of GHG emissions, accounting for 23 percent of Indonesia’s energy use in 2021. This figure is expected to increase to 40 percent by 2030.

“This investment is in line with IFC’s strategy for Indonesia, which includes a focus on decarbonization of the urban environment and climate resilience through investment and advisory support,” said Euan Marshall, IFC’s Country Manager for Indonesia and Timor-Leste.

“Financial barriers are widely seen as the biggest obstacle to adopting green building practices in Indonesia,

“To overcome these, there is a pressing need for more specialized financing tools, including sustainability-linked financing,” he added.

This investment builds on IFC’s ongoing support for climate finance in Indonesia.

By expanding access to these innovative financial solutions, IFC said it is driving the transition to a low-carbon economy and helping address the financial barriers that have hindered the adoption of green-building practices.

IFC — a member of the World Bank Group — is the largest global development institution focused on the private sector in emerging markets.

It works in more than 100 countries, using its capital, expertise, and influence to create markets and opportunities in developing countries.

In fiscal year 2024, IFC committed a record $56 billion to private companies and financial institutions in developing countries, leveraging private sector solutions and mobilizing private capital to create a world free of poverty on a livable planet.

NWP Property is one of Indonesia’s largest and fastest-growing consumer infrastructure platforms with exposure to community retail and logistics infrastructure.

NWP Property’s portfolio of modern retail assets consists of the largest independent network of modern community shopping malls in Indonesia, while its growing logistics warehouses business is supported by New Economy demand growth drivers. 

Since its inception in 2015 as a joint venture between Warburg Pincus and PT City Retail Developments, NWP Property has experienced rapid growth.

Currently NWP Property has over 50 shopping malls and logistics assets in its portfolio totaling over 1 million square meters of gross floor area (GFA).

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