What is Property Assessed Clean Energy (PACE)?
PACE is an alternative financing mechanism, passed by state legislation, enabling owners of commercial and industrial properties to receive low-cost, long-term financing for energy efficiency, water efficiency and renewable energy projects (Eligible Upgrades) through a voluntary assessment on the property’s tax bill.
What is a PACE Assessment?
A PACE assessment is a debt of property, meaning the PACE financing is tied to the property via its tax bill as opposed to the property owner, so the repayment obligation transfers with the property upon sale.
Is PACE approved in my city?
The number of active PACE markets increases by the week. To date, PACE-
Will my property qualify for PACE financing?
If your building is need of energy efficiency upgrades, your property is more than likely eligible. Petros PACE Finance will finance most commercial property types, including but not limited to shopping centers, office and industrial buildings, warehouses, hotels, hospitals, multi-family properties, schools, non-profits, etc.
Will my project qualify for PACE financing?
Most commercial property types in need of energy efficiency upgrades will qualify. Eligible measures must either save energy, produce renewable energy or conserve water.
Why use PACE financing instead of bank financing?
PACE financing is a more economical way of financing energy efficient upgrades to buildings. PACE can finance 100% of project costs and the project can be cash-flow positive from day one. The term of PACE financing can be up to 30 years, with fixed interest rates for the life of the assessment. The property owner’s debt capacity remains intact. The PACE assessments stay with the property, and do not have to be repaid upon sale of the property.
What if I currently have a mortgage? Does my mortgage lender need to give consent?
Yes, since PACE liens share the same priority as property taxes, the existing mortgage lender must give consent for the placement of the PACE assessment. In most cases, consent is likely because PACE projects will increase your building’s value and net operating income, thereby making it easier for the property owner to service the existing mortgage. We can assist you in this process.
What does Petros PACE Finance require from property owners?
Typically, very little, we work directly with your preferred contractors (if you don’t have one, we can recommend one) to obtain all the necessary information, including the list of proposed upgrades.
What are the steps for funding a project with Petros PACE Finance?
- Energy audit is obtained;
- Property owner completes our application;
- Petros PACE Finance works with the local PACE authority to obtain project approval and a consent from the mortgage lender (if any); and
- The closing and funding of the project occurs.
Do I have to obtain an energy audit?
Yes, an energy audit assesses the energy usage of systems in the building, and helps the property owner evaluate which upgrades will produce the most energy savings and are the most cost effective to pursue. With PACE financing, the energy cost savings should more than pay the PACE assessments.
What happens if I sell the property?
The PACE assessment continues with the subsequent owner, who continues to benefit from the energy cost savings.
Is PACE just for solar?
Solar is included in PACE, but PACE financing also includes: lighting, HVAC, building controls, water efficiency, and many other Eligible Upgrades.
Will Petros PACE finance 100% of my project costs?
That’s correct, we will finance 100% of your project costs, including related soft costs (i.e. engineering, legal & other fees).
How do I pay my PACE Assessment?
The assessment is included on your property’s tax bill and is typically paid annually or semi-annually.
Can I pay off my PACE assessment early?
Yes, however, a prepayment fee will apply. These terms will be detailed in Petros PACE Finance’s term sheet and the Assessment Agreement.
What is the timing of the release of PACE funds?
Petros PACE Finance funds each project directly at closing. Property owners love our direct model, there’s no waiting around for weeks to obtain bond approval.
What can I do if PACE isn’t available in my market?
Petros PACE Finance can work proactively with the PACE Authority in your area to obtain approval from your municipality and/or county.
Who is Petros PACE Finance?
Petros PACE Finance was founded by a team with decades of experience in lending, structured finance, and developing operations for smooth loan closings. We have significant institutional backing and a track record of getting PACE deals done when others can’t. Petros PACE Finance is affiliated with Petros Partners, which is an asset management and investment firm.