The commercial real estate (CRE) industry consistently challenges developers to secure cost-effective capital. High interest rates, compressed valuations, and a low leverage lending environment mean complicated funding strategies. As the industry has grown, developers have increasingly turned to C-PACE financing to secure low-cost, non-recourse, fixed-rate capital. With amortization periods of up to 30 years, owners and developers recognize that C-PACE terms are virtually unmatched in the private debt markets. C-PACE is a high-performance financial instrument with the power to reshape capital stacks and unlock long-term value.
One developer who recognized the strategic value of this financing is Renew Partners, a multi-project client of PACE Equity. Over five successful projects in the Midwest, Renew Partners utilized C-PACE to fill funding gaps and avoid high-cost capital— while enhancing returns.
Their Residences at the Agora project, the redevelopment of a historic Cleveland theater, became the first CIRRUS® Low Carbon project in the country. By meeting the low-carbon specification offered by PACE Equity, the developer accessed the industry’s lowest cost of capital. The firm pursued the program because of its reduced cost capital and because their residents and tenants are looking for healthy, efficient spaces.
“Tenants care about environmental issues and lower utility costs and we think CIRRUS will be a differentiator for us. Our goal is to have a building that is efficient over the long run… that brings value to our tenants, investors, and us.“
Shawn Neece, Principal, Renew Partners
Renew Partners also used lower-cost CIRRUS C-PACE financing to finish the capital stack for their renovation of a high-end student housing project at Lake Erie College. This project delivered upscale housing for students seeking a sustainable housing solution at the private liberal arts college in Painesville, Ohio. The college partnered with Renew Partners to redevelop an existing site and help to finance the new housing development, Painesville Tower.
The Painesville Tower was designed to meet the CIRRUS C-PACE design specification, taking advantage of the only financing option available that rewards highly efficient buildings with lower capital rates. Having utilized the financing program on previous projects, Renew Partners recognized its value in delivering better project returns.
In addition to the Agora redevelopment and the Painesville Tower renovation, Renew Partners financed three other developments with PACE Equity: the Wingate by Wyndham, TownePlace Suites by Marriott, and the 70th Apartments. In each project, C-PACE capital was used strategically to improve the project’s IRR. Furthermore, C-PACE provided additional benefits: supporting a tight closing timeline, reducing the WACC, freeing up equity for an upcoming project, and closing a funding gap. PACE Equity’s long-term, fixed-rate, non-recourse financing provided the flexibility and certainty needed to meet funding goals across different asset classes and development challenges.
As the commercial real estate industry continues to change, Renew Partners continues to rely on PACE Equity as a trusted partner that delivers private capital that works. As a repeat customer of PACE Equity, the developer knows our process well: end-to-end management that delivers a simple and streamlined experience for customers. From our in-house engineering audit to lender consent support, PACE Equity delivers a positive customer experience every time.
