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PACE lenders and property owner shaking hands to finalize CPACE funding
PACE lenders need some key information and documents before approving your financing.

Property Assessed Clean Energy (PACE) financing is an attractive but underutilized option for many commercial property owners. If you’re considering using PACE to fund projects for your property, it’s important to understand what your PACE lenders need to provide funding for this unique loan option. In this article, we will explain some of the key points of what lenders need to approve PACE funding for your commercial building. 

What Do PACE Lenders Need to Approve Financing?

PACE funding is a special type of financing option for property owners. This financing helps fund projects that improve energy efficiency, water conservation, and even building resiliency in some areas. Therefore, one of the first things your PACE lenders will need to know is whether your project fits into one of these categories. This means you will need to evaluate your planned project to see if it improves one of these things. Some projects that frequently qualify include HVAC upgrades, solar panel installation, and lighting retrofits. 

It’s also important to PACE lenders to know that the loan is cost-effective for you and that your property can pay it back based on the particulars of your PACE loan. This looks different for every property, so your lender can discuss the details with you. However, in most cases it means the loan is 25% or less of the total property value and that the long-term savings from the project can actually pay for the loan. 

As such, there are some documents you may need to show your CPACE lenders, such as:

  • Property appraisal
  • Phase I environmental report
  • Energy engineering report
  • Historical or projected operating financial statements

What are the Requirements for PACE Funding?

The important thing to remember about PACE loans is that you must get both your lender’s approval and the local PACE program administrator’s approval. Your lender can help you determine exactly what’s required for your local program. However, it’s also important to understand there are certain criteria administrators look for, including:

  • You hold the property with a clear title: no liens or unpaid property taxes
  • You must not have had any bankruptcies in the past five years
  • The savings from the project should be more than the cost of the PACE assessment
  • The value of the project should last longer than the terms of the loan
  • You file a clean Phase I environmental report with the program administrator

Also, remember that requirements and qualifications vary based on your local program. As a leading lender focused on providing PACE funding, our team can help you get the financing you need with our knowledge and experience of various PACE programs.

Stonehill PACE – Providing Commercial PACE Loans Nationwide

When you need PACE financing for your commercial property, our team at Stonehill PACE is here for you. We are a balance sheet PACE lender and work with all commercial asset classes to leverage this special financing option for projects and upgrades. In many cases, we can help you get PACE funding without changing the scope or details of your planned project. Contact us now to start the process and get the financing you need.