C-PACE (Commercial Property Assessed Clean Energy) financing offers several significant benefits for commercial property owners:
Main Benefits of C-PACE Financing
- Long-Term, Low-Cost Financing: C-PACE provides long-term financing options, typically ranging from 10 to 30 years, allowing for lower annual payments compared to traditional loans. This can significantly reduce the financial burden on property owners.
- 100% Project Financing: C-PACE can cover the entire cost of eligible energy efficiency, water conservation, renewable energy, and resilience projects, eliminating the need for upfront capital.
- Transferability: The assessments attached to C-PACE financing remain with the property, not the borrower. This means that if the property is sold, the buyer can assume the payments, providing built-in seller financing.
- Secured Lien but Non-Recourse: C-PACE uses a senior lien on the property for security, but the financing is non-recourse, meaning it does not require personal guarantees from the property owner.
- Flexibility in Project Stages: C-PACE financing can be applied at various stages of a project—pre-construction, mid-construction, and post-construction—offering flexibility in managing construction costs and reducing capital expenses.
- Improved Energy Efficiency and Sustainability: By supporting energy-efficient and renewable energy projects, C-PACE helps commercial properties meet environmental standards and reduce operational costs over time.
- Tax Benefits and Securitization Advantages: Recent IRS rulings have clarified that C-PACE assessments can be treated as qualified mortgage loans for securitization purposes, making them more attractive to investors and providing access to a broader pool of funds for property owners.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/what-are-the-main-benefits-of-using-c-pace-financing-for-commercial-properties/
