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Chapman Tripp is proud to announce its role in advising Community Housing Funding Agency (CHFA) on its debut social bond offer, marking a significant milestone in New Zealand's financial markets. The bonds are the first social bonds to be offered by a New Zealand issuer, with proceeds earmarked for social projects including affordable housing.
CHFA, established by Community Finance, serves as a bond aggregator to provide large-scale, low-cost debt financing to New Zealand’s Community Housing Providers.
The wholesale dual-tranche issuance was split evenly across $100 million of 5-year fixed rate social bonds and $100 million of 3-year fixed rate social bonds. A total of 19 investors participated, 13 of which were new to Community Finance. Total book volume at final pricing margins across the tranches excluding lead manager interest was in excess of $235 million.
Chapman Tripp assisted with the establishment of CHFA and structuring to accommodate the Government support announced in March this year. The Chapman Tripp finance team included Partner Luke Ford, Senior Associate Hayden Reyngoud and Solicitor Tom Yates. Partner Graeme Olding provided structuring and tax advice, with Senior Associate Conor Tinker.
“These social bond offerings represent a significant step forward for the New Zealand market. CHFA is the first new domestic sustainable bond issuer since 2023, reflecting a groundbreaking model for collaboration between private investors, social enterprise, and Government support to increase the delivery of social housing,” said Luke Ford.
Community Finance Chief Executive James Palmer said, “We are immensely proud of the support that investors have shown for CHFA as we work to tackle New Zealand’s estimated $13 billion social housing deficit. The legal support and practical guidance that Luke, Graeme and their teams have provided has been invaluable as we’ve navigated uncharted waters to bring these social bonds to market.”
ANZ acted as the lead manager on the offer and Intemark assisted as capital markets adviser to CHFA, with Public Trust serving as trustee and security trustee. Buddle Findlay advised ANZ as lender to CHFA, and Dentons Kensington Swan advised Public Trust.
Chapman Tripp has a strong track record in advising on a wide range of green, social and sustainability bonds. This includes the first green bond in the New Zealand market (IFC’s 2015 green Kauri bond issuance), every sustainability bond offered by a New Zealand issuer (including Christchurch City Holdings’ sustainability bonds and Housing New Zealand’s wellbeing bonds), the New Zealand government’s Sovereign green bond programme, and social bonds offered by international issuers, including the world’s first orange bonds, offered by Impact Investment Exchange (IIX).
