Funds from The City of Kyoto's inaugural green bond will be used for renovation projects aimed at energy conservation projects in city-owned facilities as well as river improvement projects.

The five-year JPY 5 billion ($37.8 million) bond was issued last December.

It is part of a city-wide strategy to attract sustainable investment in businesses that could help achieve the UN's Sustainable Development Goals.

Award judges applauded its "unique biodiversity focus" and efforts to improve energy efficiency and rivers as these are "great areas for municipalities to address".

54 investors were involved in the transaction, which helped it over-exceed its initial target. A number of the investors were also first-time buyers of municipal bonds, according to Goldman Sachs.

"The strong demand for the issue is testament to this historic city's commitment to investing in a more sustainable future," said Satoru Kawahito, head of Japan public sector and infrastructure at Goldman Sachs.

The bond is structured around the Green Bond Principles and attained a second opinion from local ratings agency Japan Credit Rating Agency.

Deal highlights:

Issuer: The City of Kyoto
Coupon: 0.259%
Maturity date:  20 December 2027
Use of proceeds: Clean transportation, climate change adaptation, energy efficiency, green buildings, pollution prevention and control, renewable energy, sustainable management of living natural resources, terrestrial and aquatic biodiversity conservation
External reviewer: Japan Credit Rating Agency
Lead managers: Daiwa Securities Group, Nomura, Goldman Sachs
Credit rating: A1 (Moody's)