What Is C-PACE?

C-PACE is a public-private partnership that provides capital to increase building energy efficiency and to improve the systems and physical structure of commercial real estate properties. C-PACE is levied as a special assessment in the property records and repayments are made via an assessment on a property tax bill. C-PACE is currently available in more than half of the nation’s states, plus the District of Columbia, and is rapidly gaining momentum in many more.

Eligible Uses

C-PACE can finance building improvements for efficiency, renewable energy, and resiliency projects that contribute to energy and water savings. Applicable costs include, but are not limited to, heating/cooling HVAC improvements, interior and exterior lighting, building controls, windows, and in many instances, water efficiency measures. Light to heavy renovation, gut rehab, adaptive reuse, and ground-up development projects may all utilize C-PACE to improve capital efficiency and create a more effective capital stack.

Eligible Properties

C-PACE finance is available for most commercial property types, including hospitality, industrial, office, retail, multifamily, agricultural, non-profit, and senior living and healthcare-related properties.

How Does It Work?

The financing is similar to a long-term, self-amortizing, fixed-rate loan with terms of generally 10 to 30 years. Repayment terms are restricted by the estimated useful life of the improvements which they finance. At closing, the stream of interest and amortization payments are converted into a voluntary, non-ad valorem special assessment which is recorded in the land records and repaid through annual payments, comparable to real estate taxes.