JOO GROUP - GREEN LOAN

The project will finance new high-energy performance residential buildings in Finland.

The aim is to support the national strategy to develop low-energy consumption buildings, to be significantly below the level required for residential buildings in Finland.

Given the focus of the operation on the construction of new and affordable high energy performance residential buildings, the underlying investments will support the EU's and Bank's priority in the energy sector (energy efficiency and renewable energy) and the EIB's climate action objectives. Finland has implemented the Nearly-Zero Energy Building standard. However, the building construction norms are not yet aligned with Net-Zero standard, and there is room for further efficiency improvements. This operation will contribute to the achievement of Finland's Integrated Energy and Climate Plan targets.

Through energy savings, energy efficiency projects reduce carbon emissions and air pollution, increase comfort, air quality in the buildings, and reduce dependency on energy imports, social and public benefits that are not fully internalised by private investors.

The project has a good Economic Rate of Return and will generate good social benefit.

In addition with the sub-projects in Tampere and Turku, the project will contribute to Cohesion policy objective.

The EIB support to this operation is expected to provide tangible financial benefit, positively contributing to the implementation of the Promoter's investment pipeline of energy efficient buildings. The EIB loan will diversify the borrower's funding sources and provide a loan tenor for senior unsecured financing, which is not available from commercial sources. The EIB loan's flexible disbursement features provide further benefit to the Promoter in sequencing construction related cash outflows in optimal manner. The Bank's support would have a positive signalling effect to other financiers, crowding-in other debt financing to this project as well as to other growth capex financing needs of the Promoter. The EIB loan is subordinated to the Borrower's senior secured financing.

Given the relative scale, location and nature of the project in built-up urban areas, all of the buildings are deemed not to have any significant negative environmental or social impact. Exceptionally, a building may fall under Annex II of the Environmental Impact Assessment (EIA) Directive 2011/92/EU (as amended by the Directive 2014/52/EU). In such cases the EIB requires the promoter to act according to the provisions of the aforementioned Directive leaving it to the competent authority to decide in line with the Directive whether an EIA procedure is needed or not. The Bank will review relevant permits public consultations and authorization processes during appraisal, including mitigation measures to be taken. Through the project, a new high energy performance building, as per the requirements of the Energy Performance of Buildings Directive (EPBD) 2010/31/EU, will be constructed and will, after completion, reduce energy consumption and pollutant emissions by going beyond the current near-zero energy building regulation.

The promoter has been assessed by the EIB as being a private company not being subject to EU rules on public procurement or concessions. However, if at the project appraisal, the EIB were to conclude that the promoter is subject to the EU public procurement legislation then the Bank would duly inform the Commission Services and would require the promoter to apply those rules.