How is the Chevalier Group supporting sustainable development in Hong Kong?

In a densely populated residential neighbourhood in the East of Hong Kong Island, a unique social housing project is taking shape.

The 22-storey Jockey Club Key House will be the first co-living project in the city that provides both accommodation and support services for out-of-home youths and people in recovery.

Hong Kong-based Chevalier Group is leading the construction of the landmark development with the help of a HKD100 million (USD12.8 million) green and social loan from HSBC, the first of its kind arranged by the bank in the territory.¹

The project is driven by SideBySide, an organization that has been dedicated to promoting social inclusion for marginalised, at-risk groups in Hong Kong since 1957. The building has been designed to a high energy-efficiency standard and is expected to attain a BEAM Plus Platinum certification on completion, the top rating in the leading environmental assessment tool for buildings in Hong Kong.

The financing comes from HSBC’s Greater Bay Area (GBA) Sustainability Fund², set up in May last year, to provide businesses in the region with financial support to capture sustainable opportunities while transitioning to a low-carbon economy. The bank expanded the fund in August from USD5 billion to USD9 billion on the back of strong client demand and an expanding range of investment opportunities.

“The Chevalier Group is committed to sustainable development across its diverse business operations. With a robust financial status and promising growth prospects, we are delighted to collaborate with HSBC in this meaningful green and social loan”, says HS Kuok, Chairman and Managing Director of the Chevalier Group.¹

The Chevalier Group's financing has been structured in line with both the Green Loan Principles and Social Loan Principles of the Asia Pacific Loan Market Association, highlighting its positive contributions to environmental and social outcomes.³

The deal adds to the growing pool of GBA projects with environmental and social benefits. Debt funding for green, social, and sustainable projects in the GBA reached a record RMB66.8 billion (USD9.3 billion) in the second quarter of 2023, according to the HSBC GBA ESG Index.⁴

Dick Wong, Head of GBA Commercial Banking at HSBC China, adds: “From the positive feedback about the GBA Sustainability Fund, we can see that the sustainable development of the GBA is in the ascendant and has great potential. We hope the increased fund investment and our diversified sustainable finance products and services will help businesses in the GBA to grasp the sustainability growth.”

Building on long-standing commitments to sustainable waste management and energy efficiency⁵, the Chevalier Group recently partnered with certification company SGS to implement a digital carbon management platform to help it understand its suppliers' greenhouse gas emission levels and encourage their reduction. It is the first construction company in Asia to implement the tool⁶. As the first deal of its kind, the Key House project sets the stage for future developments that combine both social and environmental features and contribute to Hong Kong’s goal of reaching carbon neutrality by 2050.

Today we finance a number of industries that significantly contribute to greenhouse gas emissions. We have a strategy to help our customers to reduce their emissions and to reduce our own. Find out more: https://www.hsbc.com/who-we-are/our-climate-strategy.