IFC eyes more funding for Ayala Land's 'greener' malls, developments

The World Bank Group's private-sector lending arm, the International Finance Corporation (IFC), is reportedly considering another round of financial backing for Ayala Land Inc. (ALI).

The potential investment would support ALI's ongoing efforts to renovate and expand its main malls, aiming to make them more environmentally friendly.

A World Bank document indicated that on July 3, the IFC's board was scheduled to discuss a proposed investment in ALI for a project referred to as "AyalaLand SLF2 Project."

Last year, ALI secured a $250 million (P14.3 billion) loan from the IFC under their initial Sustainability-Linked Financing (SLF) agreement. This funding was allocated to help ALI achieve its net-zero emissions target, which included making 10 malls in Metro Manila and Cebu more "green." In October 2024, the IFC confirmed its investment in ALI's sustainability-linked loan, which has a term of up to eight years. The financing was approved and the loan agreement signed in July of the previous year.

This marked ALI's first sustainability-linked financing package, specifically designed to reduce carbon emissions across its commercial real estate holdings. Part of the loan proceeds will be used to renovate flagship shopping malls such as Ayala Center in Cebu City; Glorietta 1, 2, 3, and 4, as well as Greenbelt 2, 3, 4, and 5 in Makati City; and TriNoMa in Quezon City.

Earlier IFC documents clarified that this ALI project would involve only internal and external refurbishment, without altering the existing size of these malls, with the goal of transforming them into "green" buildings. The IFC had previously stated that ALI and its wholly owned subsidiary, Makati Development Corp. (MDC), plan to complete all demolition and construction work for this mall renovation project by the end of 2026.

The project aims to enable ALI to claim the world's largest EDGE Zero Carbon property portfolio, while significantly reducing its greenhouse gas (GHG) emissions, which contribute to climate change. Through this financing, ALI intends to increase its office space compliant with IFC’s Zero Carbon Certification to 1.5 million square meters (sqm) by the end of 2025, a significant jump from approximately 350,000 sqm in 2024.

In April 2024, a memorandum of understanding (MOU) was signed with AyalaLand Hotels and Resorts Corp. (AHRC), an ALI subsidiary, to have its projected 2,826 hotel rooms become EDGE Zero Carbon-certified by 2026. The IFC had also highlighted that ALI is the largest property developer in the Philippines, with over 11,000 hectares (ha) of land bank and 52 estates nationwide.