The unique assessment structure of CPACE provides numerous benefits for property owners and developers. It can spread out the upgrade costs, free up your yearly budget, realize dramatic energy cost savings, and reduce your credit risk.

100% financing of hard and soft costs with no out-of-pocket

Displaces higher cost mezzanine and equity capital

Fixed-rate financing with up to 30-year terms and interest only options

Increases net operating income and property value

Decreases utility and maintenance costs

Ability to recover as an operating expense

Facilitates sustainable building design

Promotes economic development and urban revitalization

Benefits for Owners

Retroactive financing with CPACE can help commercial property owners and developers shore up capital stacks and access liquidity at any point in the economic cycle, but it becomes especially beneficial during periods of capital market constriction and economic uncertainty like we are experiencing today. Retroactivity is generally available as follows:

No Upfront Costs

Efficiency projects financed by traditional loans or through equity might not meet internal

PACE provides 100%, long term financing of hard and soft costs with no out-of-pocket expenses

Frees up operating and capital budgets

Cash flow positive from Day 1

Non-Recourse, Non-Accelerating

Most traditional forms of financing and energy performance contracts are recourse to the owner and accelerate upon sale or foreclosure.

PACE is non-recourse to owners

Interest rate and payments are fixed over the 10-30 year term and under no circumstance, even default or bankruptcy, can they accelerate

Transferable Payment Obligation

Owners are typically hesitant to invest in long payback efficiency measures if it is possible they will sell the building before recovering their investment.

PACE liens attach to the property and “run with the land”, automatically transferring from one owner to the next so the building owner only “pays for what he uses”

Underwriting based primarily on the property

Immediately Cash Flow Positive

Capital constrained property owners may not have budgetary capacity for efficiency projects with long payback periods.

Long repayment periods (10-30 years) means the annual PACE payments are typically lower than savings generated by efficiency project

Energy savings generated outpace project costs plus the cost of financing (total PACE assessment) from Day 1

Owner keeps any tax credits and/or rebates as a result of the project

Solve Split Incentive Lease Structures

Under many lease structures, when corporate capital is used to fund projects, savings generated go directly to the tenant’s bottom line resulting in negative cash on cash return for the owner

Due to the assessment mechanism, PACE is often passed to tenants for recovery in the same manner as property taxes

Tenants receive utility savings that outweigh the property tax assessment

Aligns property owner and tenant interests

Increased Property Value

Some property owners might wonder what value will these improvements add to their property

PACE improvements extend the life of the building

Building becomes more desirable to tenants

Addresses deferred maintenance issues

Reduced Operating Expenses

U.S. businesses spend almost $200B/yr. on utilities, at least 30% of which is unnecessary

Lower utility bills

Reduced maintenance expenses

Increases net operating income (NOI)

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