C-PACE: Why Not Pay Less to Finance Your Sustainable Building?
C-PACE: A Cost-Saving Two-for-One
C-PACE: Your Sustainable Building Could Cost Less and Save More
C-PACE: Your Building Improvements Could Cost Less and Save More
C-PACE: Lower Your Interest Payments with This One Weird, Old Trick
Constructing a new building, or renovating an existing property, isn’t cheap; and if you’re filling financing gaps with mezzanine debt or equity, you may be paying 12%, 15%, or more in interest costs. In the past two years, a new program known as Commercial Property-Assessed Clean Energy (C-PACE) financing, has become available offering much lower, fixed rates.
What’s the catch? The only “catch” is that you use have to use this lower-interest money to install efficient HVAC equipment, upgrade to LED lighting, switch to low flow water fixtures, improve your windows or insulation, and take other steps that are going to save you even more money. The amount you can borrow under C-PACE terms cannot exceed the cost to purchase and install your efficiency upgrades. However, “soft” costs such as engineering, design, permitting, commissioning, energy modeling, and inspections which are tied directly to your energy conservation measures are eligible as well.
If you’re a building developer, or if you grow out of your new space, you’ll be happy to learn that C-PACE is tied to a property, and not to the borrower. Selling a building transfers the obligations of the program to the new owner.
The Stone House Group is proud to have been involved in the very first C-PACE project ever funded in Pennsylvania! A few months ago, our team of energy auditors and energy modelers helped a multi-use urban renewal project in downtown Philadelphia (“Center City” to our fellow SE Pennsylvanians) secure over $1.5 million in low cost financing. Read about it here:
We would love to help you navigate the C-PACE process in Pennsylvania, Washington D.C., Delaware, Connecticut, or any of the 35 states where PACE programs are available, as you realize your own building stewardship dream.