C-PACE for Retrofits

C-PACE enables commercial property owners and developers to obtain low-cost, long-term financing for energy efficiency, water efficiency, renewable energy, and resiliency retrofits.

How it works

Like many public finance mechanisms, C-PACE financing is repaid via a special assessment on the property’s tax bill. C-PACE assessments, however, are 100% privately funded – no public or taxpayer money is involved.

Petros obtains written consent from all lenders with a secured interest in the property. Mortgage lenders’ acknowledgment and consent will include a description of the C-PACE financing and a certification from the mortgage lender that the financing does not create an event of default under the terms of the mortgage.

c-pace retrofit solar energy
C-Pace retrofit construction

C-PACE financing means

  • No upfront costs
  • Financing is non-recourse, non-accelerating
  • Transferable payment obligation
  • Increases property value
  • Reduces operating expenses
  • Immediately cash flow positive
  • Solves split incentive lease structures

How it works

Like many public finance mechanisms, C-PACE financing is repaid via a special tax assessment on the property’s tax bill. C-PACE assessments, however, are 100% privately funded – no public or taxpayer money is involved.

Petros obtains written consent from all lenders with a secured interest in the property due to indebtedness. Mortgage lenders’ acknowledgment and consent will include a description of the C-PACE financing and a certification from the mortgage lender that the financing does not create an event of default under the terms of the mortgage.

c-pace retrofit solar energy
building cranes over city skyline

C-PACE financing means

  • No upfront costs
  • Financing is non-recourse, non-accelerating
  • Transferable payment obligation
  • Immediately cash flow positive
  • Solves split incentive lease structures
  • Increases property value
  • Reduces operating expenses

How it works

Like many public finance mechanisms, C-PACE financing is repaid via a special tax assessment on the property’s tax bill. C-PACE assessments, however, are 100% privately funded – no public or taxpayer money is involved.

Petros obtains written consent from all lenders with a secured interest in the property due to indebtedness. Mortgage lenders’ acknowledgment and consent will include a description of the C-PACE financing and a certification from the mortgage lender that the financing does not create an event of default under the terms of the mortgage.

c-pace retrofit solar energy

C-PACE financing means

  • No upfront costs
  • Financing is non-recourse, non-accelerating
  • Transferable payment obligation
  • Immediately cash flow positive
  • Solves split incentive lease structures
  • Increases property value
  • Reduces operating expenses
building cranes over city skyline

C-PACE vs Alternatives

C-PACE builds value by enabling implementation of sustainable upgrades, while also positively impacting a property’s bottom line. Funding a retrofit project with C-PACE financing can lower the total cost of capital and generate a faster time to positive cash flow compared to utilizing a conventional loan or by self-funding. In turn, the energy savings boosts net operating income (NOI) and increases the value of the property for building owners.

financing scenarios comparison summaries

Debt Financing

Out-of-Pocket Equity Investment

Energy Savings (First Year)

Annual Debt Service Payment

Free Cash Flow Impact Year 1

Capitalization Rate

Value to Property Owners (FCF/Cap Rate, if positive)

Years to Positive Project Cash Flow

Cost of Capital (Assume Equity Costs @20%)

Self-Funded

$0

$5,000,000

$537,415

$0

($4,462,585)

7.00%

$0

9.1 Years

20.00%

Conventional Loan

$4,000,000

$1,000,000

$537,415

$898,508

($1,361,093)

7.00%

$0

10 Years

8.20%

PACE Financing

$5,000,000

$0

$537,415

$446,241

$91,174

7.00%

$1,302,483

Immediately

8.20%*
*subject to market rate

Cumulative cash flow effect on financing type

Retrospective Cumulative cash flow effect on financing type

Additional Benefits of C-PACE for Retrofits

  • Frees up operating and capital budgets
  • Cash flow positive from day one, potentially
  • Interest rate and payments are fixed over 10-30-year terms and under no circumstances, even default or bankruptcy, can they accelerate
  • 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 they use”
  • Underwriting based primarily on the property, no personal guarantees
  • Owner keeps any tax credits and/or rebates as a result of the project
Retrospective pyramid building

Additional Benefits of C-PACE for Retrofits

  • Frees up operating and capital budgets
  • Cash flow positive from day one
  • Interest rate and payments are fixed over 10-30-year terms and under no circumstances, even default or bankruptcy, can they accelerate
  • PACE liens attached to the property and “run with the land,” automatically transferring from one owner to the next so the building owner only “pays for what they use”
  • Underwriting based primarily on the property, no personal guarantees
  • Owner keeps any tax credits and/or rebates as a result of the project
Retrospective pyramid building

Additional Benefits of C-PACE for Retrofits

  • Frees up operating and capital budgets
  • Cash flow positive from day one
  • Interest rate and payments are fixed over 10-30-year terms and under no circumstances, even default or bankruptcy, can they accelerate
  • PACE liens attached to the property and “run with the land,” automatically transferring from one owner to the next so the building owner only “pays for what they use”
  • Underwriting based primarily on the property, no personal guarantees
  • Owner keeps any tax credits and/or rebates as a result of the project
Retrospective pyramid building

Featured Petros Funded Retrofit Projects