The Global Hospitality Group of Jeffer Mangels Butler & Mitchell LLP (JMBM) has completed $210 million in C-PACE (Commercial Property Assessed Clean Energy) financing transactions in the past 12 months, for hotel, retail and multi-family real estate clients.
Led by Senior Partner David A. Sudeck, the group has worked on both the lender and borrower side of these transactions, and has represented some of the leading names in PACE financing.
“David and his team have been structuring these transactions since the beginning of the C-PACE program, and have developed an expertise in this area of financing,” said Jim Butler, chair, JMBM’s Global Hospitality Group. “This type of financing has become especially beneficial for clients during unpredictable economic fluctuations due to COVID.”
C-PACE is a low-cost, nonrecourse financing that creates a lien on the real property and is repaid through property taxes. In most cases, there is no balance sheet or personal liability of the owner or developer. Over the past several years, C-PACE financing has gained wider acceptance, and moved from a novel technique to a widely accepted, practical solution to financings.
“Over the years, C-PACE has become an increasingly recognized part of the financing toolkit; the COVID downturn motivated lenders to become familiar with PACE in the capital stack,” said Sudeck. “As a result of that familiarity, we find that these same lenders are embracing the inclusion of PACE financing as an important part of a post-COVID marketplace.”
According to PACENation, an industry organization, C-PACE fundings in the U.S. have totaled about $1.5 billion since states began implementing the program; deals handled by Sudeck and his team account for a significant percentage of all C-PACE transactions in the country. Of the 18 deals completed in the last year, 12 were hotels, including a $23.8-million loan for a Napa, CA, resort, a $42-million loan for a newly constructed downtown Los Angeles hotel and a $10-million loan for two hotels in Sunnyvale, CA.