Precinct Properties New Zealand Limited/Announcement

PCT Launches Sustainable Debt Programme

ESG25 November 2020PCTReal Estate

Precinct Properties New Zealand Limited Head Office Wellington Office
E hello@precinct.co.nz Level 12, 188 Quay Street, Auckland 1010 T 0800 400 599 Level 19, 157 Lambton Quay, Wellington T 0800 400 599
W www.precinct.co.nz PO Box 5140, Auckland 1141, New Zealand F +64 9 927 1655 PO Box 2, Wellington 6140, New Zealand F +64 4 494 2267
NZX announcement - 26 November 2020
PCT Launches Sustainable Debt Programme
Precinct’s Chief Financial Officer, Richard Hilder says, “We are pleased to be launching a
Sustainable Debt Programme recognising Precinct’s ongoing commitment to creating a more
sustainable environment.”
The establishment of the Sustainable Debt Framework (The “Framework”) is a natural extension
of Precinct’s sustainability strategy and the focus on sustainable business outcomes. The
Framework sets out the process by which Precinct intends to issue and manage Sustainable
Debt on an ongoing basis to fund low carbon buildings within Precinct’s property portfolio.
Proceeds from the issuance of Green Bonds or Loans will be used wholly or in part to finance
or refinance existing and/or planned Eligible assets. Eligible assets will have to meet the
following criteria before proceeds can be allocated to them:
1. Certified as obtaining, or targeting, a minimum 5-Star NZGBC Green Star Built rating; or
2. Certified as obtaining, or targeting, a minimum 4-Star NABERSNZ Energy Base Building Rating or
Energy Whole Building Rating.
Precinct’s existing retail bonds (PCT010 and PCT020) will be covered by The Framework and
Precinct intends to issue further debt covered by the Framework from time to time.
The Programme was implemented with assistance from ANZ acting as Green Bond
coordinator with independent assurance provided by EY.
In addition, Precinct are taking an active approach to climate action, as well as best practice
disclosure. Precinct has prepared a Climate-related Financial Disclosures document which
summarises Precinct’s approach to our climate change risk management and is based on the
Taskforce on Climate-related Financial Disclosures (TCFD) recommendations. The document
can be found on Precinct’s website.
Further information on Precinct’s approach to Sustainability, including The Framework and
Independent Limited Assurance Report can be located on Precinct’s website at
https://www.precinct.co.nz/sustainability.

-ends-

For further information, contact:
Edward Timmins
General Counsel & Company Secretary
Office +64 27 935 2823
Email: edward.timmins@precinct.co.nz

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Precinct
sustainable
debt
framework
2020

02
Purpose.
Purpose.
PRECINCT PROPERTIES NEW ZEALAND LIMITED
The purpose of this document is to outline the governance
framework under which Precinct Properties intends to issue and
manage various Sustainable Debt products. As relevant market
standards and best practice continue to evolve over time,
Precinct retains the right to make changes to the Sustainable Debt
Framework (the “Framework”), at it's discretion. We welcome
feedback on our approach from all market participants.
Contents
Introduction to Precinct03
Precinct sustainable debt framework05
Green bonds and loans06
Sustainability linked bonds and loans08
Appendices & contacts09

03
Introduction to Precinct.
Introduction to Precinct.
SUSTAINABLE DEBT FRAMEWORK
Our Strategy
Precinct's strategy focuses on three distinct areas: our
people and partners, operational excellence and
developing the future. The primary objective being to
create sustainable value from city centre real estate.
Our ambition
Our ambition is to control or own strategic city centre precincts,
enabling us to create vibrant environments which attract
occupiers. While predominantly invested in office buildings,
Precinct may invest in other city centre real estate including
land, retail, hotel and value-add properties where there is
opportunity to create value. Precinct's development activities
are enhancing our portfolio while attracting and retaining high
quality clients.
We understand that the operational aspects of Precinct's
business as an owner, developer and a manager of property,
have an external impact on a number of environmental, social
and economic issues.
Our sustainability strategy has therefore been designed in
parallel with Precinct's broader business strategy. This alignment
has provided us with a sustainability framework which we have
adopted to both assist and illustrate Precinct’s sustainability
context, approach and priorities.
Our sustainability framework
Our approach
Precinct's approach reflects the goal of a more environmentally
sustainable management model, recognising the drive to a
more environmentally sustainable portfolio. Our objective is to
deliver improvements in environmental performance and
operational costs, and meet the trend from occupiers to prefer
more environmentally sustainable office accommodation.
The overarching measure we currently use to benchmark our
sustainability performance is the Global Real Estate Sustainability
Benchmark (GRESB). Being able to measure Precinct’s
sustainability operational performance and having measurable
long-term targets is a key priority.
The assessments are guided by what investors and the industry
consider to be material issues in the sustainability performance of
real estate investments. GRESB is considered the global standard
for ESG benchmarking and reporting for real estate. Precinct
achieved a GRESB score in 2019 of 77 out of 100 (2018: 69). This
score compares with the GRESB global average for 2019 of 72.
Precinct also reports in accordance with the Global Reporting
Initiative (GRI) Standards (core option). This requires Precinct to
identify and report against the material sustainability issues
facing the business. For more information on all material
sustainability issues please see the sustainability section of
Precinct's annual report.
The key targets that relate to these material sustainability issues
include;
GRESB
Global real estate sustainability benchmark.
• Our target is be in the top quartile of reporting global
peers.
Green Star
•
Precinct targets both a 5 Green Star Design and As-
built rating (Excellence) for new developments.
• Targeting over 50% of the portfolio having at least a
best practice (4 star) Green Star rating
Greenhouse Gas emissions (GHG)
•
NABERSNZ: Targeting 4 star (excellent performance)
for new developments and a minimum 3-star rating
(good performance) for all properties.
•
Carbon Disclosure Project (CDP): Targeting A
leadership and strategic best practice
•
Carbon emission intensity: Precinct's long-term
science-based target is for total emissions measured
by the weighted average (by area) of the portfolio to
be aligned with the Climate Bond Initiative by 2030, to
meet the Paris Agreement emissions reduction targets.

04
Introduction to Precinct.
Introduction to Precinct. (Continued)
PRECINCT PROPERTIES NEW ZEALAND LIMITED
Design and building ratings
such as Greenstar and
NABERSNZ ratings provide a
credible method to measure
the environmental and
sustainability performance of
our properties. However,
Precinct is going a step further
by engaging Toitū Envirocare
(Toitū) to help quantify and
measure Precinct’s direct
(combustion of any type of
fuel) and indirect (imported
energy, transportation and other sources) emissions. Once
quantified and measured, Precinct will account for the cost of
emissions based on the current cap of New Zealand’s emission
trading scheme. Precinct will then offset emissions through
accredited programmes such as the
Gold Standard.
Any
amount leftover will be invested in emission mitigation strategies.
By way of example these could include management and
reduction plans, industry partnership programmes and
investment in capital projects.
Precinct is very pleased to
have achieved Toitū
carbonzero certification.
R I C H A R D H I L D E R , C F O
Precinct is a member of the New Zealand Green Building Council
(NZGBC) and works in partnership with the NZGBC on a wide
range of market-based green building practices (For instance
The Zero Carbon Road Map for Aotearoa’s Buildings. For more
information on the Zero Carbon Road Map Download: Here)
Precinct is also a long-term supporter of the Auckland City
Mission and Wellington City Mission. In addition to financial
support, Precinct works together with both Missions on
fundraising initiatives throughout the year. In 2018 Precinct
agreed to a 5-year financial commitment to support the
Auckland City Mission’s HomeGround project; a purpose-built
housing and social services facility providing safe space to stand
against homelessness, hunger and poor health.
Precinct is a member of GRESB and Diversity Works.

05
Precinct sustainable debt framework.
Precinct sustainable debt framework.
SUSTAINABLE DEBT FRAMEWORK
The establishment of the Precinct Sustainable Debt Framework (The “Framework”) is a natural extension of Precinct’s
sustainability strategy and the focus on sustainable business outcomes. The Framework sets out the process by which Precinct
intends to issue and manage Sustainable Debt on an ongoing basis to fund low carbon buildings within Precinct’s property
portfolio.
Sustainable Debt may include:
• Green bonds and loans, and;
• Sustainability linked bonds and loans
• Bonds and loans may be designated as Sustainable Debt at the time of issue or any time thereafter.
The Framework sets out the processes for these products separately.
The Framework may be subsequently updated at Precinct’s discretion as relevant market standards and best practice
continue to evolve over time.
10 Madden Street

06
Green bonds and loans
Green bonds and loans
PRECINCT PROPERTIES NEW ZEALAND LIMITED
Use of Proceeds bonds and loans issued under the Framework
may take the form of:
• Green Bonds in accordance with the ICMA Green Bond
Principles (GBP)
• Green Loans in accordance with the APLMA Green Loan
Principles (GLP)
In accordance with the above market standards and
best practice, the Framework covers four key
components as follows:
1. Use of Proceeds;
2. Process for Project Evaluation and Selection;
3. Management of Proceeds; and
4. Reporting
Use of proceeds
An amount equivalent to the net proceeds from the issuance of
Green Bonds or Loans will be used wholly or in part to finance or
refinance existing and/or planned Eligible assets.
Eligible assets
Precinct intends to allocate proceeds to energy efficient
buildings utilising the Green Star or NABERSNZ ratings tools.
Eligible assets will also align with the GBP or GLP. Existing and/or
planned buildings, including upgrades will be eligible to be
categorised and labelled as an Eligible asset, and proceeds can
be internally allocated to them, if they meet the following
criteria:
1. Certified as obtaining, or targeting, a minimum 5-Star NZGBC
Green Star Built rating; or
2. Certified as obtaining, or targeting, a minimum 4-Star
NABERSNZ Energy Base Building Rating or Energy Whole Building
Rating.
If an Eligible asset no longer meets the Eligibility Criteria set out in
this Framework, then it will no longer be categorised as an
Eligible asset and the total value of Eligible assets will reduce by
the value of this asset.
A list of Eligible assets which have attained Green Star or
NABERSNZ certification will be published within annual Use of
Proceeds reporting.
Process for project evaluation and selection
Precinct has processes that are in place to ensure that Eligible
assets are identified and evaluated appropriately to ensure
compliance with this Framework.
In determining eligibility of Precinct’s low carbon and energy
efficient buildings, Precinct will assess the following where
applicable:
•
Current NABERSNZ rating. Assets across the portfolio are rated
as part of Precinct’s ongoing monitoring of its operational
assets. NABERSNZ is a system for rating the energy efficiency
of office buildings. It is an independent tool, backed by the
New Zealand government.
•
Green Star Rating. Green Star is an internationally recognised
rating system for the sustainable design, construction and
operation of buildings, fit out and communities. Green Star
provides a trusted mark of independent verification to
support decision-making.
Once projects are determined to have met all relevant criteria
for inclusion, assets will be included as Eligible assets.

07
Green bonds and loans
SUSTAINABLE DEBT FRAMEWORK
Management of proceeds
Precinct commits to tracking the receipt and allocation of net proceeds via internal reporting systems. Precinct will maintain a register
of Eligible assets, including the notional allocation of net proceeds against each Eligible asset.
Precinct intends to fully allocate net proceeds immediately following issuance of any ne Sustainable Debt.
Precinct intends to monitor proceeds and balances of eligible assets on an annual basis.
Unallocated proceeds or surplus funds
Precinct does not intend to have any unallocated proceeds. Precinct intends to maintain a balance of Eligible assets as described
above, based on market value, which is larger than the sum of net proceeds from all Use of Proceeds bonds or loans.
In the unlikely event of any unallocated proceeds or surplus funds, Precinct will ensure any unallocated proceeds are applied to
temporarily reduce indebtedness of a revolving nature before being redrawn for investments or disbursements to Eligible assets.
Reporting
Precinct understands the importance of transparency and disclosure. All reporting will be in line with applicable market standards.
Impact reporting may be provided where applicable or incorporated within Use of Proceeds reporting.
The following reporting will be made publicly available following issuance:
DocumentTiming
Sustainable debt framework
At time of first issuance (subsequently updated at Precinct’s discretion)
Assurance statements
At time of first issuance and annually thereafter
Use of proceeds reporting
Annually
Use of proceeds reporting
Precinct intends for annual Use of Proceeds reporting to include:
• Summary of Eligible assets (location, type of asset, asset value)
• Current NABERSNZ and/or Green Star rating
• Confirmation of aggregated amount of proceeds
• Details of allocation of proceeds per Eligible assets
• Disclosure of any unallocated proceeds
• Confirmation of accordance with applicable market standards
• Assurance updates or the most recent assurance report
Assurance
In accordance with the applicable market standards, Precinct will seek assurance from an approved verifier prior to first issuance and
on an annual basis, and as deemed necessary by Precinct.
Confirmation of assurance will be made publicly available.
Important Notice
For the avoidance of doubt, and unless otherwise specified in relation to specific Green Bonds or Loans, if Precinct fails to earmark the
proceeds in the manner described in the Framework or fails to comply with the Framework or related matters; Green Bonds or Loans
cease to satisfy the GBP or GLP; or Precinct undertakes non-eligible projects outside of this Framework:
• no event of default or any other breach will occur in relation to the Green Bonds or Loans; and
• neither investors nor Precinct have any right for the Green Bonds or Loans to be repaid early.
This means there is no legal obligation on Precinct to earmark the proceeds of Green Bonds or Loans in the manner described in this
Framework or to comply with this Framework, the GBP or the GLP on an ongoing basis. Bonds and loans may cease to be labelled as
green, in which case investors may consider that the bonds or loans no longer align with their intentions or requirements and may (as
applicable) have increased difficulty finding interested buyers or obtaining an acceptable price.

08
Sustainability linked bonds and loans
Sustainability linked bonds and loans
PRECINCT PROPERTIES NEW ZEALAND LIMITED
Sustainability Linked Bonds and Loans are distinct from Green
Bonds and Loans as previously defined. Proceeds from
Sustainability Linked Bonds and Loans are utilised for general
corporate purposes and do not require proceeds to be
evaluated, monitored or tracked.
Issuance of Sustainability linked Bonds and Loans will seek to be
consistent with the elements of the ICMA Sustainability linked
Bond Principles (SLBP) and the LMA Sustainability Linked Loan
Principles (SLLP) respectively. This section of the Framework
covers the following elements:
1. Relationship to Borrower’s Overall Corporate Social
Responsibility (CSR) Strategy
2. Target Setting
3. Reporting
4. External Review
Relationship to the borrowers overall corporate
social responsibility (CSR) strategy
When undertaking any issuance of Sustainability Linked Bonds
and Loans, Precinct will communicate how the instrument, the
Key Performance Indicators (KPIs) and the Sustainability
Performance Targets (SPTs) relate to and are material to,
Precinct’s overall Sustainability Strategy and Framework.
Target setting
Precinct has a commitment to achieve a more environmentally
sustainable property portfolio. For the issuance of Sustainability
Linked Bonds and Loans, where the bond coupon or the loan
margins are linked to the achievement of SPTs, Precinct has
provided the below metrics as a guide for potential KPIs:
• NABERSNZ building ratings
• GRESB rating
• Carbon Disclosure Project
• Green Star property ratings
• Ratings on a subset of properties or Precinct’s total
portfolio
• Energy, water or waste consumption for properties, or
on a portfolio basis
• Greenhouse gas (GHG) emissions for properties, or on
a portfolio basis
• Other sustainability metrics (environmental or social)
that are relevant to Precinct’s overall Sustainability
Strategy and Framework.
Measurement of performance with respect to KPIs for any
Sustainability Linked Bonds and Loans will be undertaken
periodically as relevant. At a minimum, measurement will be
annual.
Precinct intends to ensure the SPTs and KPIs used will be
meaningful to Precinct’s sustainability and will involve
appropriate ambition.
Reporting
For Sustainability Linked Loans, Precinct and the arranging
bank(s) or financial institution(s) will agree on the appropriate
reporting parameters and the schedule for disclosing information
on sustainability performance to the lenders.
For Sustainability Linked Bonds, Precinct will undertake annual
public reporting with regards to the issuance and sustainability
performance against the selected targets. This reporting will be
available on Precinct’s website.
Precinct will disclose at issuance the reporting that will be
provided, including its location, frequency, scope and assurance
commitments. Precinct will focus on providing timely information
regarding performance in relation to the selected SPTs for each
transaction.
External review
Precinct will undertake some form of independent and external
assurance for each Sustainability Linked Bond or Loan on issue.
This includes external review of sustainability performance prior to
issuance and ongoing post issuance assurance over Precinct’s
performance in relation to the selected SPTs for each issuance.
This will be made publically available for Sustainability Linked
Bonds and will be made available to lenders at a minimum for
Sustainability Linked Loans.
Governance
Precinct’s internal working group for sustainable debt will form
part of Precinct’s Sustainability Committee. Precinct’s
Sustainability Committee acts as custodian for Precinct’s
sustainability strategy and comprises representatives from various
parts of our business including Operations, Development,
Corporate and Investor Relations and Human Resources. The
committee meets frequently during the year, at least quarterly.
The committee is responsible for assessing, actioning and driving
ESG issues, reviewing performance and considering Precinct’s
long-term strategy on sustainable activities across the business
and reporting on its progress, which will include Sustainable debt.
Sustainable debt will be included into the agenda of the
Sustainability Committee meeting and any matters arising will be
noted into the Audit & Risk papers on an ongoing basis and
consequently overseen at a Board level.
Precinct’s CFO is the Chair of Precinct’s Sustainability Committee
and is responsible for Precinct’s overall Sustainability Strategy
and Emissions and Reduction Plan. The CFO will also be
responsible for any sustainable debt which Precinct undertakes
and will report to the wider senior management team and at a
Board level, quarterly.

09
Appendices & contacts
Appendices & contacts
SUSTAINABLE DEBT FRAMEWORK
Appendices
More information on Precinct's approach to sustainability can be found:
On our website:
www.precinct.co.nz/sustainability
In our Annual Report:
https://www.precinct.co.nz/reporting-and-disclosure
Contacts
Precinct Properties New Zealand Limited
Registered Office of Precinct
Level 12, 188 Quay Street Auckland, 1010 New Zealand
T:+64-9-927-1647
E: hello@precinct.co.nz
W: www.precinct.co.nz
Registrar - Investors
Computershare Investor Services Limited
Level 2, 159 Hurstmere Road Takapuna, North Shore City Private Bag 92 119 Auckland 1142 Telephone: +64-9-488-8700
Email: enquiry@computershare.co.nz
Website: www.computershare.co.nz
Fax: +64-9-488-8787

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Use of Proceeds Report as at 24 11 2020
Value of Eligible assets
1
:
Existing Green Assets
AddressCityBuilding NameUseCurrent NABERSNZ RatingGreen Star Rating
Asset Value
2
($NZD)
21 Queen StreetAucklandJarden HouseOffice4 Star Base Build Rating5 Star Office Built (v1) Rating (+d)$124.0 M
29 Customs StreetAucklandAMP CentreOffice4 Star Base Build RatingN/A$205.0 M
139 Pakenham StreetAucklandMason BrothersOffice5.5 Star Base Build Rating6 star custom built rating$46.6 M
12 Madden StreetAucklandBuilding 5aOffice5 Star Base Build Rating5 star custom built rating$86.0 M
15 Customs StreetAucklandCommercial Bay TowerOfficeTargeting 4 Star5 Star Office Design (2009) Rating$580.0 M
38 Bowen StreetWellingtonCharles Fergusson BuildingOffice4.5 Star Base Build Rating4 Green Star Office Built V3 $92.1 M
34 Bowen StreetWellingtonDefence HouseOfficeTargeting 4 StarUnderway$176.0 M
Total existing green assets$1,309.7 M
Committed Green Development Assets
AddressCityBuilding NameUseCurrent NABERSNZ RatingGreen Star Rating
Total project cost
($NZD Million)
10 Madden StreetAuckland10 Madden StreetOfficeTargeting 4 Star5 Star Custom Design Rating$72.0
40 Bowen StreetWellington40 Bowen StreetOfficeTargeting 4 StarUnderway$90.2
Total Committed green development assets$162.2 M
Total value of eligible assets$1,471.9 M
1. Eligible assets must have a mimimum (or target) 5-star NZGBC Green Star Built rating or a minimum 4-Star NABERSNZ Energy Base Building Rating
2. Fair value as at 30 June 2020
Value of Green Bonds on Issuance:
NZX tickerOutstanding Date of Issuance
Maturity
date
PCT010$75.0 M17-Dec-1417-Dec-21
PCT020$100.0 M27-Nov-1727-Nov-24
Total$175.0 M

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A member firm of Ernst & Young Global Limited
Independent Limited Assurance Report to the Directors and
Management of Precinct Properties New Zealand Limited

1

Other Matters
We draw attention to the use of external property valuations to determine whether the value of the total project pool
exceeds the combined value of Precinct the Green Bonds. Some of these external property valuations have been
prepared as at 30 June 2020 and contain paragraphs explaining the valuations have been concluded on the basis of
material valuation uncertainty due to the impact of the COVID-19 pandemic on the property market, indicating that
less certainty and a higher degree of caution should be attached to the valuation than would normally be the case.
Our opinion is not modified in respect of this matter.

Scope
Ernst & Young (‘EY’, ‘we’) was engaged by Precinct to undertake a limited assurance engagement, as of 11
November 2020, in relation to Precinct’s Green Bonds in order to provide an opinion as to whether the subject
matter detailed below (‘Subject Matter’) meets, in all material respects, the Criteria as present below.

Subject Matter and Criteria
The subject matter and associated criteria for this limited assurance engagement are set out in the table below.

Subject Matter Criteria
The subject matter for this limited assurance
engagement includes:
• Environmental performance and information
relating to additional projects to be funded by the
Bonds
• Policies and procedures relating to the
management of the Bonds
• Precinct’s green borrowing documentation
including the Precinct’s Sustainable Debt
Framework.

The ICMA Green Bond Principles (June 2018)
requirements on:
• Use of Proceeds
• Process for Project Evaluation and Selection
• Management of Proceeds
• Reporting.
Criteria found at:

The ICMA Green Bond Principles 2018
1
.

Technical details of the assets identified as ‘green’
(‘Green Assets’)
Use of Proceeds and Eligibility Criteria from Precinct’s
Sustainable Debt Framework that eligible assets are
office, industrial or retail buildings (including upgrades)
that meet the following criteria:
• Certified as obtaining or targeting a minimum 5-
Star NZGBC Green Star Built rating; or
• Certified as obtaining or targeting a minimum 4-
Star NABERSNZ Energy Base Building Rating or
Energy Whole Building Rating.

1
https://www.icmagroup.org/assets/documents/Regulatory/Green-Bonds/Green-Bonds-Principles-June-2018-270520.pdf
Assurance conclusion
Based on our limited assurance procedures, as described in this statement as of 11 November 2020, nothing
came to our attention that caused us to believe that the following outstanding Green Bonds (‘the Bonds or “the
Green Bonds”’) issued by Precinct Properties New Zealand Limited (“Precinct”):
• PCT 17/12/21 5.54% Precinct Properties New Zealand Limited Bonds (PT010)
•PCT 27/11/2024 4.42% Precinct Properties New Zealand Limited Bonds (PT020)
have not been presented, in all material respects, fairly and in accordance with the International Capital Market
Association (“ICMA”) Green Bond Principles (June 2018) and the Precinct’s Sustainable Debt Framework
(“Criteria”).

A member firm of Ernst & Young Global Limited

2

Management Responsibility
The management of Precinct is responsible for the preparation and fair presentation of the Subject Matter. This
responsibility includes establishing and maintaining internal controls relevant to the preparation and presentation of
the Subject Matter that is free from material misstatement, whether due to fraud or error, selecting and applying
appropriate accounting policies; and making estimates that are reasonable in the circumstances.

Assurance Practitioner’s Responsibility
Our responsibility is to express a conclusion on whether anything has come to our attention that causes us to
believe that the Subject Matter, has not been presented, in all material respects, fairly and in accordance with the
criteria detailed above. Our assurance engagement has been planned and performed in accordance with the
International Standard on Assurance Engagements (New Zealand) 3000: Assurance Engagements Other than
Audits or Reviews of Historical Financial Information (‘ISAE (NZ) 3000’).

Our Approach
Our assurance procedures performed included, but were not limited to:
• Reviewing whether the policies and procedures established by Precinct related to the post issuance of the
Green Bonds to assess whether they were aligned to the requirements of the Green Bond Principles 2018
• Confirming the eligibility of assets for inclusion in Precinct’s Green Bonds use of proceeds pool against
Precinct’s Sustainable Debt Framework
• Interviewing selected business units and group level personnel to understand key issues related to Precinct’s
relevant policies and procedures
• Checking the accuracy of asset valuations
• Requesting documentation supporting assertions made in the Subject Matter
• Seeking management representation on key assertions.
Limitations
There are inherent limitations in performing assurance – for example, assurance engagements are based on
selective testing of the information being examined – and it is possible that fraud, error, or non-compliance may
occur and not be detected. There are additional inherent risks associated with assurance over non-financial
information including reporting against standards which require information to be assured against source data
compiled using definitions and estimation methods that are developed by the reporting entity. Finally, adherence to
ISAE (NZ) 3000 and the Green Bond Principles 2018 is subjective and will be interpreted differently by different
stakeholder groups.
Our assurance was limited to Precinct’s Green Bonds and did not include statutory financial statements. Our
assurance is limited to policies and procedures in place as of 11 November 2020. Ernst & Young provides statutory
audit services and other assurance services to Precinct. We provide an agreed upon procedures engagement
recalculating the performance fee paid or payable to Precinct’s manager. Ernst & Young and Precinct have entered
an agreement in respect of our proposed occupancy of a Precinct property. Partners and employees may deal with
Precinct on normal terms within the ordinary course of trading activities of the business of Precinct. We have no
other relationship with, or interest in, Precinct.
Use of Report
Our responsibility in performing our assurance activities is to the Directors and Management of Precinct only and in
accordance with the terms of reference for this engagement as agreed with them. We do not therefore accept or
assume any responsibility for any other purpose or to any other person or organisation. Any reliance any such third
party may place on Precinct’s Green Bonds is entirely at its own risk. No statement is made as to whether the
criteria are appropriate for any third-party purpose.
Our Independence and Assurance Team
In accordance with APES 110 Code of Ethics for Assurance Practitioners, the firm and all professional personnel
involved in this engagement have met the independence requirements of New Zealand or International professional
ethical requirements. Our team has the required competencies and experience for this assurance engagement.
Level of Assurance
Procedures performed in a limited assurance engagement vary in nature and timing from, and are less in extent than
for, a reasonable assurance engagement. Consequently, the level of assurance obtained in a limited assurance
engagement is substantially lower than the assurance that would have been obtained had a reasonable assurance
engagement been performed. While we considered the effectiveness of management’s internal controls when
determining the nature and extent of our procedures, our assurance engagement was not designed to provide
assurance on internal controls. Our procedures did not include testing controls or performing procedures relating to
checking aggregation or calculation of data within IT systems.

A member firm of Ernst & Young Global Limited

3

Observations on particular aspects of our engagement:
We provide selected observations aligning to the Green Bond Principles 2018 core components, to provide the
reader with further understanding on how these Green Bonds meets the Criteria. These observations are not
intended to detract from our conclusion provided above.

Use of Proceeds:
• Proceeds from the Green Bonds are intended to be used for financing and re-financing purposes.
• Proceeds are intended to be allocated to office, industrial and retail buildings (including upgrades) owned or
undertaken by Precinct that have, or are targeting, a minimum of a 5-Star New Zealand Green Building
Council (NZGBC) Green Star Built rating and/or a 4-Star NABERSNZ Energy Base Building Rating or
Energy Whole Building Rating.
• Any building that fails to meet the Eligibility Criteria set out in the Sustainable Debt Framework or loses its
rating during the tenor of the bond will no longer be categorised as an Eligible Asset and the total value of
the Eligible Projects will be reduced by the value of the removed asset.
• The NZGBC Green Star rating (Green Star NZ) is an internationally recognised standard developed for New
Zealand. Green Star NZ is aligned with the other major international building rating tools, including the
British BREEAM (Building Research Establishment Environmental Assessment Method) system and the
North American LEED (Leadership in Energy and Environmental Design) system. Green Star NZ assesses
the overall environmental impact of a building covering the following categories: Energy, Water, Materials,
Indoor Environment Quality, Transport, Land Use & Ecology, Management, Emissions, and Innovation. It
rates buildings from 0 to 6 Stars. Buildings that achieve a 4, 5, or 6 Star rating receive Green Star
certification.
• NABERSNZ rating is adapted from the National Australian Building Environment Rating System (NABERS)
and is a national rating tool for commercial buildings administered by NZGBC. NABERSNZ rates the actual
environmental operational performance of office buildings across Energy, Water, Waste and Indoor
Environment. It rates buildings from 0 to 6 Stars. Buildings that achieve a 4, 5, or 6 Star rating are assessed
as having excellent performance, market leading performance and aspirational performance respectively.
• The use of proceeds of these Bonds aligns with the Green Bond Principles 2018 project category “green
buildings which meet regional, national or internationally recognised standards and certifications”.

Process for Project Evaluation and Selection
• Precinct has developed a Sustainable Debt Framework that outlines the environmental objectives of Green
Bonds, eligibility criteria for determining Green Assets and the process for project selection and evaluation.
The list of Precinct’s eligible Green Assets tested is included in Annex A.

Management of Proceeds
• Precinct has set-up an internal Working Group for sustainable debt to oversee the governance of Green
Bonds
• Precinct has implemented processes to manage proceeds received from Green Bonds and to monitor the
on-going use of proceeds. These processes include:
• A tracking process through existing internal reporting systems to allocate funds received to Green Assets
• A process for deploying any unallocated proceeds to temporary cash equivalent investments
• An annual process for monitoring the on-going use of proceeds
• Precinct will obtain on-going assurance over the Green Bond portfolio to confirm that the Green Assets
continue to meet the Green Bond Principles 2018 and the requirements as set out in the Sustainable Debt
Framework.

Reporting
• Precinct will report on the use of proceeds of Green Bonds at least on an annual basis that will include a list
of Green Assets, the amount allocated to each Green Asset and the Green Star rating and/or NABERSNZ
rating of each Green Asset.

A member firm of Ernst & Young Global Limited

4

Ernst & Young Limited

Graeme Bennett
EY Assurance Partner

9 November 2020

A member firm of Ernst & Young Global Limited

5

Annex A

Precinct’s list of eligible green assets

Existing Green Assets:
Nominated Project Class Country
Jarden House, 21 Queen Street, Auckland Green Buildings New Zealand
AMP Centre, 29 Customs Street, Auckland Green Buildings New Zealand
Mason Brothers, 139 Pakenham Street, Auckland Green Buildings New Zealand
Building 5A, 12 Madden Street, Auckland Green Buildings New Zealand
Commercial Bay Tower, 15 Customs Street, Auckland Green Buildings New Zealand
Charles Fergusson Building, 38 Bowen Street, Wellington Green Buildings New Zealand
Defence House, 34 Bowen Street, Wellington Green Buildings New Zealand

Development Green Assets:
Nominated Project Class Country
10 Madden Street, Auckland Green Buildings New Zealand
40 Bowen Street, Wellington Green Buildings New Zealand

44 Bowen Street Committed and PCT First Quarter Dividend Quarterly Report December 2020

Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.