Combining C-PACE Financing with Other Options
C-PACE financing can indeed be combined with other financing options to support a wide range of projects, particularly in the commercial property sector. Here’s how it integrates with various financing strategies:
How C-PACE Works with Other Financing
- Capital Stack Integration: C-PACE financing is often used as a supplementary component within a project’s capital stack, bridging gaps where other financing options fall short. It can be used alongside senior debt, mezzanine financing, and equity investments.
- Combining with Government Programs: Developers can combine C-PACE with government incentives like Low-Income Housing Tax Credits (LIHTC) or other green loan products to increase the overall funding for a project.
- New Construction and Retrofits: For new construction projects, C-PACE typically covers 15-25% of the total project costs, while for retrofits, it can provide 100% funding. This flexibility allows developers to mix different funding sources effectively.
- Recapitalization and Post-Construction Financing: C-PACE can be used post-construction to recapitalize projects, stabilize assets, or pay down more expensive forms of financing, thereby optimizing a project’s financial structure.
Benefits of Combination
- Cost Efficiency: By integrating C-PACE with other financing options, developers can reduce their overall cost of capital and enhance project feasibility.
- Flexibility: C-PACE offers long-term repayment options (up to 30 years) with fixed rates, making it a strategic addition to any capital stack.
- Energy Efficiency: It encourages investments in energy-efficient and renewable energy upgrades, enhancing the sustainability and marketability of properties.
Overall, combining C-PACE with other financing options provides developers with a versatile toolset to navigate complex projects while promoting sustainable practices.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/can-c-pace-financing-be-combined-with-other-financing-options/
