PACE financing is a unique financing option that can be used for many projects. Many associate Property Assessed Clean Energy (PACE) loans with energy efficient upgrades to existing buildings. However, in many places, you can also use PACE for new construction projects. Often, you can do this without significantly changing the design or scope of your construction plans. Office buildings are a common type of new construction that may benefit from PACE financing.
If you need financing, get in touch with our team today to discuss the options.
How to Use PACE Financing for Office Buildings
PACE for office building construction is much like any other project. There is a qualification process with both the lender and the PACE authorities in your area. These criteria vary based on the location, but usually the project must meet certain standards for reduced energy consumption, reduced water consumption, or building resiliency. It’s also important to show that the applicable features, which are permanent to the structure, will provide enough savings over time to exceed the cost of the loan and also last longer than the term for PACE financing. Other qualifications include no bankruptcies in the past five years and properties must be held with a clean title.
You can use PACE funding for many different things for your office building construction project. Since many office buildings now prioritize sustainability, a lot of your plans likely already qualify. For instance, utilizing as much natural light as possible. Natural light has been shown to increase productivity and can also reduce how much energy you use for lighting during the day. Other features that may qualify for PACE financing include LED lighting, efficient HVAC systems, high efficiency windows, and cool roofs. These all can also save you money on utility bills once the building is up and running.
Benefits of PACE Funding
PACE funding for office building construction offers many desirable features. Here are some key things to know about office building commercial PACE loans from Stonehill PACE:
- Minimum of $1 million
- Fixed rate starting at 7%
- Amortization up to 30 years
- Up to 30% LTV
- Loan fee 1-2%
- Non-recourse except with carve outs
There are also some other important things to know about PACE financing. For one, payments act as a property assessment on your property tax bill, so there’s no need to worry about tying up cash flow in monthly payments. Also, the financing transfers to the new owner with property sale. PACE can finance up to 100% of qualified projects, including both hard and soft costs. Talk to your PACE lenders about the specifics of your project to understand how PACE can lower total construction financing costs.
Stonehill PACE – Your Trusted PACE Lenders
Want low-cost, long-term financing? Contact our team at Stonehill PACE. We are a direct lender offering financing for all commercial asset classes. Our team works with you to find financing solutions without changing the scope of your project. We maintain close relationships with PACE authorities to ensure a smooth qualification process. Get started today with our team of experts.