Mid-Construction Use of C-PACE Creates Liquidity

cpace-creates-liquidity-for-mid-construction-project---jpg C-PACE programs encourage and incentivize the integration of energy-saving and renewable infrastructure in the built environment through long-term low-cost financing. Traditionally PACE financing is accessed for retrofits and new construction, but the development stage of a project isn't limited to future work. PACE financing can be applied to completed and mid-construction projects, which makes it an extremely useful tool for projects that are experiencing cost overruns such as those experiencing delays and increased costs due to the COVID-19 public health crisis.

The Poway Outpost, a 53-unit Class AAA luxury multifamily and retail project under development in Poway, California, a San Diego suburb, recently secured $13.7 million in mid-construction C-PACE financing from CounterpointeSRE. The project experienced cost overruns from unexpected groundwater issues and increased expenses attributed to the COVID-19 crises. With project specifications that included significant seismic resiliency work (a measured covered in California) and traditional PACE-qualifying elements of HVAC, LED lighting, water conservation, and building envelope measures, the developer was well positioned to recapitalize a portion of the project with C-PACE.

Read more by clicking the case study image at right.

ADVANTAGES TO USING PACE FOR RECENTLY COMPLETED OR MID-CONSTRUCTION PROJECTS

can help cover construction overruns
ensures long-term stability of capital stack
method to extract working capital from completed energy-saving and resiliency elements of project
can reduce senior loan payments

"For mid-construction projects we're able to help developers recapitalize, recover and keep moving towards a successful finish line."

- Adam Lipkin, Director, CounterpointeSRE

FINANCE TERMS

fixed-rate, non-recourse & prepayable with rates typically under 6%
ability to capitalize interest during entire bridge period
fully funded at closing
flexible prepayment terms available

AVAILABILITY OF 'LOOK BACK' OR 'RETROACTIVE' PACE FINANCING

typically 1-3 years since completion
available in the following states AR, CA, CT, CO, DC, DE, FL, IL, KY, MD, MI, MO, MN, NE, NY, OH, OR, PA, RI, TX, UT, and WI

Note 1: Bright/light green denotes PACE-enabled with look-back, darker green is PACE enabled without look-back, blue represents an enabled / non-active PACE state.
Note 2: Some PACE policies only allow for in-flight projects, or require an energy evaluation to have been performed before evaluation.