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PACE Equity Funds First New Construction CPACE Project in California

PACE Equity has completed funding for the IHG - Hotel Indigo in Coachella, California. This is a landmark project as it is the first new construction CPACE project in California. PACE Equity financed approximately $7.9 million for the project, which represented 15% of the $51m development cost. Additionally, PACE Equity also provided energy modeling & engineering and obtained all required approvals, while managing the bond process and assisting with structuring the capital stack. PACE Equity was chosen in favor of a substantially more expensive mezzanine debt and other outside capital.

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Background

For nearly 20 years, the Coachella Valley Music and Art Festival has drawn hundreds of thousands of people to
the desert of southern California. Despite the success and longevity of the festival, as well as Stagecoach, Desert Trip and Dinah Shore, there are no major hotels to serve the festival goers, especially a luxury hotel within close proximity to the grounds. 
One of the attendees for many years, Stuart Rubin, decided it was time to change that.

"This is the culmination of years of work to bring the first IHG – Hotel Indigo to Coachella. As longtime travelers to the area, we are proud of what we’re creating and look forward to the opening in the fall. Utilizing PACE Equity reduced our cost of capital.”

Stuart Rubin, Project Developer

Why They Chose Us

The Hotel Indigo needed a capital solution which solved several needs: 

  • A reduction of cost compared to the other options, which included mezzanine debt and other outside investors
  • Allowed the developers to retain control of the project
  • Financing that would work with a forthcoming Mello-Roos Communities Facilities District (CFD) and EB-5 at a later date

New Construction Hotel Project Reduces Cost of Capital with PACE Equity. Download the case study.

 PACE Equity's financing supported all of these goals and drove a substantial reduction to the project's cost of capital (learn how much in the case study).

Stuart Rubin, the project's developer, further commented, “The entire development and financing team worked closely together to see our vision achieved. What made the difference was that PACE Equity brought not only financing but a turnkey service including the structuring with the rest of the capital stack, the required approvals for PACE and the necessary energy engineering.”

This Is What We Do

After pioneering the use of CPACE financing with ground-up development, this is PACE Equity’s 8th funded new construction project across 6 different states. By utilizing a turnkey approach, PACE Equity has unmatched expertise in funding CPACE for development projects across the country. 

Download the case study for the first new construction hospitality project from PACE Equity.

“This was a complex project financing with a lot of moving parts and parties involved. I am glad we were able to set an expectation very early in the process and deliver exactly on that expectation. And now I can’t wait to stay at such a beautiful resort.  We are thrilled to be a part of this great development.” - Beau Engman, PACE Equity Founder & President.

 


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