PETROS PACE FINANCE CLOSES $1.3 MILLION C-PACE LOAN IN HOUSTON
First C-PACE loan for office retrofit in Texas to save owner $3.66 million over 20 years
AUSTIN, TEXAS (November 16, 2017) — Petros PACE Finance has closed on a $1.3 million Commercial Property Assessed Clean Energy (C-PACE) transaction that will fund significant energy efficiency upgrades to a Houston office building that are projected to save the owner more than $3.66 million over the term of the 20-year loan.
Property owner 1225 North Loop Investments, Inc. plans to install new chillers with associated water pumps, variable speed drives and air handlers, a building control system and LED lighting in the 200,400-square foot building 1225 North Loop West.
The project will be financed without any out-of-pocket expense to the investment group through the City of Houston commercial PACE program, which allows commercial property owners to retrofit their buildings with renewable energy and energy and water efficient systems by borrowing money from a private lender and repaying the loan via a special assessment on their local property tax.
“Outdated mechanical and building systems result in higher utility and operating costs for landlords and tenants, but financing energy efficiency upgrades is often a challenge for owners of older buildings,” said Petros CEO Mansoor Ghori. “This C-PACE loan will finance the improvements to 1225 North Loop West at no cost to the owner while spreading the cost out over many years with the certainty of a fixed-rate loan.”
“PACE introduces a new solution for building upgrades, at no additional cost to the owner,” said Seth Eslami, vice president of Stellar International, which manages the property. “The savings in energy costs will pay for the upgrades while leading the path to a greener future.”
This project marks the first time that any C-PACE program in Texas has been used to fund energy efficiency improvements to a multitenant office building.
“PACE Houston is pleased to have facilitated the first multi-tenant office building PACE project in the State of Texas,” said PACE Houston Energy Efficiency Solutions President Tim Crockett. “Petros showed its substantial expertise throughout the underwriting process of this project. We believe this project will demonstrate the huge value PACE can provide a building owner and thus lead to more owners using this powerful tool.”
Completed in 1984, 1225 North Loop West already rivals or outperforms many newer office buildings when it comes to energy efficiency. The Class A building meets more than 50 percent of its electricity needs through renewable wind sources and has received six ENERGY STAR awards since 2010.
The upgrades are expected to save the building owner more than 1.5 million KWH in energy use and $2.9 million in energy costs over 20 years. Utilizing the C-PACE program, the owner also can take advantage of tax-related benefits in the form of annual interest deductions and equipment depreciation along with any eligible rebates.
Petros is one of the first specialty finance firms in the U.S. to dedicate all of its resources to the commercial PACE market nationwide. This is the eighth C-PACE loan that Petros has funded in Texas and its second in Houston.
Currently available in 32 states and Washington, D.C., PACE financing makes comprehensive clean energy projects possible on a broader scale for the first time by:
- Providing up to 100 percent financing to commercial property owners in order to fund energy efficient projects that deliver deep energy cost savings through the life of the loan.
- Rendering a private loan into a property tax obligation and enabling lenders to grant longer terms of up to 30 years or the useful life of the upgrades.
- Allowing commercial property owners to increase the value of their existing buildings by reducing total energy costs and increasing net operating income.
For more information visit http://www.petros-pace.com.
Petros PACE Finance
Austin-based Petros PACE Finance, LLC is solely dedicated to providing long-term PACE financing to U.S. commercial property owners seeking to increase their property values and reduce their carbon footprint. The principals of Petros PACE Finance – Mansoor Ghori, Tommy Deavenport and Jim Stanislaus – have substantial experience in structured finance and lending, and bring significant value to all parties involved in the transactions in which they participate.