Summer Associate, Dalila E. A. Haden, contributed to this blog.
In early June, the first Commercial Property Assessed Clean Energy (“C-PACE”) transaction closed in New York City, courtesy of C-PACE financing provided by Petros PACE. In connection with a larger $500 million dollar acquisition and construction financing deal involving a 1.2 million square-foot office building in the Wall Street area, Petros PACE provided $89 million dollars of C-PACE financing for the transaction. According to Petros PACE, the C-PACE funds will be used to make the building more energy efficient.
With New York City’s first C-PACE financing deal in the books, more eligible building owners should begin taking advantage of the City’s C-PACE financing program,[1] especially as the carbon emissions requirements set forth in Local Law 97 begin to take effect.[2] To avoid facing hefty penalties, eligible building owners should consider C-PACE financing to implement energy efficient technologies in order to be in compliance with Local Law 97 and the Climate Mobilization Act. New York City’s PACE Program is sponsored by the Mayor’s Office of Sustainability and administered by the New York City Energy Efficiency Corporation, in collaboration with the New York City Department of Finance.
The recent Petros PACE transaction will hopefully be the start of a bright future for the usage of C-PACE financing in New York City. As traditional lenders continue to get more comfortable with C-PACE financing programs and eligible property owners seek out this financing, New York will undoubtedly become a more sustainable and energy efficient city.
[1] For more information on C-PACE financing, please take a look at one of our previous blogs: https://www.csrealconblog.com/2020/08/articles/real-estate/finance/commercial-property-owners-new-financing-available-for-existing-and-new-energy-cap-ex-projects/
[2] For more information on Local Law 97 and the Climate Mobilization Act, please take a look at one of our previous blogs: https://www.csrealconblog.com/2019/12/articles/construction/new-york-city-building-owners-what-does-greennewdeal4ny-mean-for-you/
