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How CPACE Financing Helps You Make Improvements

CPACE financing - Stonehill PACE
You can make your building look and function like it’s brand new again using CPACE financing.

Businesses often have a list of improvements they mean to take care of, but don’t have capital available to make these improvements. Luckily, CPACE financing can help your company make these changes without negatively affecting your cash flow. While many people know that they can use CPACE financing for major renovations or new construction projects, businesses can also use PACE loans for smaller upgrades and even to finance resiliency projects.

There are many advantages to using CPACE financing for your improvements. For example, you can use this funding to increase your building’s value and marketability. Additionally, PACE loans can fund 100% of the hard and soft costs for PACE approved projects. Therefore, if you have a list of changes you wish to make, consider talking to your PACE lenders about how they can help.

Using CPACE Financing for Interior Systems

CPACE financing isn’t just for major projects. In fact, you can use this loan program for systems like HVAC upgrades or new lighting systems. You can even use PACE loans for roof replacement projects. The CPACE program allows business owners to make upgrades to their buildings that are cost-efficient and help you save in the long-term. Therefore, if you have older lighting systems, HVAC units, or a failing roof, CPACE may be able to help. Using CPACE financing, you can make improvements to your building that you simply didn’t think you could before. Additionally, this financing option allows you to pay off the loan over a long period of time as a line on your property tax bill. Therefore, this low-cost financing option is great for small and large projects that will improve your building and your business.

PACE Loans Can Be Used for Structure Hardening

Resiliency projects designed to help your building withstand disasters are also a great way to protect your livelihood. Unfortunately, many companies put these improvements on the back burner, as they often require a fair amount of up-front capital. Luckily, under PACE programs, many states allow you to receive PACE loans to help fund these structure hardening improvements. These alterations help reduce damage, injuries, and outages during disasters. Therefore, CPACE financing helps protect your company from unpredictable and devastating events without hurting your bottom line.

Therefore, there are many ways you can use CPACE loans for your business. At Stonehill PACE, we are a leading PACE lender that works with commercial property owners to help fund new construction, recapitalization, and value-add projects. As a leading provider of PACE loans, we understand how to help you finance these enhancing projects. Our experts will handle all the aspects of the PACE qualification process so you can focus on your daily operations. Call us today at (678) 823-9313 to discuss your options with our team and learn more about the PACE program. We are here to serve you.

Using PACE Funding to Finance New Multifamily Construction

PACE funding - Stonehill PACE
Did you know you can use PACE funding to help construct a new apartment building?

As interest rates rise, many developers are looking for low-cost capital acquisition alternatives. This is where PACE funding can help with new multifamily construction projects. In the past, PACE loans were for energy efficient improvements on existing buildings. Now, you can use PACE funding for new construction projects that meet a few minimal guidelines. If you are planning on constructing a new multifamily complex, consider using PACE financing as part of your financing options. Take a look at this general guide to CPACE loans for new multifamily construction.

What is PACE Funding?

PACE funding is a capital acquisition option in the form of a property tax assessment. Therefore, interest rates for PACE loans are significantly lower than mezzanine financing or equity. It can lower the cost of capital by as much as 20%, which makes it an attractive financing option. Additionally, PACE funding repayments are added to your property tax statement and are seen as an operating cost. Therefore, this financing option doesn’t count as debt for a property. It is especially appealing for multifamily construction, as CPACE loans are transferrable if you decide to sell your property later on.

How Do PACE Loans Benefit Multifamily Development?

CPACE loans offer a lot of value to multifamily developments. First and foremost, it offers low-cost capital for your construction project. Additionally, you can use this financing for a wide variety of things, like construction materials, equipment, and building features that tend to lower operating costs. For example, you can use CPACE funding for electrical and plumbing systems, insulation, roofing, building management systems, and even electric car charging stations on your property. More and more, tenants are looking for these features when choosing a rental unit. Therefore, these features can add value to your property by drawing in more renters and reducing your overall costs during and after construction. PACE financing requirements are flexible enough that you can use it for both renovations and new construction projects for multifamily properties.

How Do I Receive PACE Financing?

If you already have a plan for your multifamily development, you should speak to a PACE lender about how you can meet your local PACE requirements. Generally, these standards require you to:

  • Be up to date on property tax payments and have no current liens
  • Have no bankruptcies listed in the last 5 years
  • Show that the savings of your project will exceed the cost of the PACE assessment over the life of the loan
  • Provide evidence that your project’s value will last longer than the loan term
  • Submit a Phase I Environmental Report to your PACE program administrator

Typically, your CPACE lender can help you navigate these requirements and processes to help you receive PACE funding. They can also work with your current plans to meet requirements for PACE loans. Therefore, you should work with a lender who knows the ins and outs of this program to set your construction project up for success.

At Stonehill PACE, we have unparalleled experience in the PACE lending industry. Our specialists work with developers and property owners to help new construction projects and major retrofits receive CPACE funding, submit the necessary paperwork, and guide you through the PACE process. Our engineers can help you maximize your proceeds without changing the scope or adding costs to your construction project. Additionally, we maintain strong relationships with program administrators to ensure a smooth qualification process. Call us today at (678) 823-9313 to begin your approval process. We are here to serve you.

Using CPACE Financing for New Hotel Construction

 

CPACE financing- Stonehill PACE
You can use CPACE financing to help with soft and hard construction costs for your new hotel. Choose the right PACE lender to help you through the process.

CPACE financing offers a unique capital solution for new hotel construction. PACE funding was designed to help businesses improve and construct new buildings. Additionally, repayment for this financing option is usually spread out over years. If you are building a new hotel, you should consider PACE financing to assist with construction costs.

CPACE Financing Can Help Reduce Costs

Constructing a hotel often requires large, up-front capital, so reducing costs is a priority. Traditional loan repayment depends on your profitability. Because these loans hinge on the risk that you won’t make enough to pay back the loan, they often come with higher interest rates.

By contrast, CPACE financing is tied to the value of your property. Paying back CPACE loans is very similar to paying your property taxes. For these reasons, it is typically easier for a lender to recuperate their investment in you. Therefore, these loans often offer lower rates. Hoteliers can reduce the overall costs of financing hotel construction with low interest PACE loans. CPACE financing can fund up to 20% of your property’s value, which equals savings overtime compared to 100% financing through a traditional loan.

PACE Loans Can Help Cash Flow During and After Construction

Since CPACE financing offers lower costs for initial capital, your cash flow may be more stable during and after construction. You repay this loan once a year as a line on your property tax bill. Repayment terms also tend to be longer than traditional loans. Therefore, your payments are typically in lower amounts and paid once a year. This can keep capital in your pocket until you get up and running. Therefore, PACE financing offers more stable cash flow during and after your hotel construction. Because this new construction financing typically costs less than traditional loans, you keep more of your profits overtime.

PACE Financing Can Be Transferred

Additionally, you can transfer your CPACE loans with sale of the property. This can be a major benefit for hotels in particular. Oftentimes, if a hotel becomes well-known, is in a good location, and is lucrative, a larger corporation may try to acquire it for their brand. If this happens with your hotel, you can transfer your CPACE financing the new owners. Therefore, you won’t be on the hook for repayment after you sell the property.

At Stonehill PACE, we are a direct PACE lender that specializes in commercial funding for new construction and major redevelopments. We can help you finance your new hotel construction or renovation project. Our team has the experience and relationships you need to handle all the aspects of your qualification process. Call us at (678) 823-9313 to learn more or to start on your hotel construction approval process. We are here to serve you. 

How PACE Funding Differs from Mezzanine Financing

Since PACE funding is a relatively new financing option, you may wonder how it is different from mezzanine financing. They are similar in some ways, however there are some major differences between mezzanine financing and PACE funding. Because of this, it may make more sense to use one or the other to finance your project. Knowing what each entails will help you make a wise decision regarding how you finance your projects.

Mezzanine Financing

Mezzanine financing is typically used to expand established institutions. They are generally not utilized during the early stages of a company’s founding. This type of financing bases funding on property equity. If the borrower defaults on the loan, the lender can convert to an equity interest after senior lenders are paid.

For borrowers, mezzanine loan interest is tax deductible. If need be, the interest on the loan can generally be deferred should the company not be able to pay it.  However, for these perks, the borrower gives up some control because they sacrifice equity to receive this type of financing.

PACE Funding

On the other hand, PACE funding can be used for new construction or for major renovations. PACE loans are based on the total project value and can finance as much as 25% of the value of the building you are constructing or renovating. However, repayment is done through property tax assessments. They offer a fixed rate, which is different than mezzanine financing. Additionally, should you sell your property, your PACE funding can transfer to the new owner. Overall, CPACE offers fewer risks than traditional mezzanine funding.

As your PACE lenders, Stonehill PACE can help you maximize your PACE proceeds without changing the scope of your project or adding on costly features. Our team has unparalleled experience in PACE financing, with knowledge of each state’s legislation and programs. We also work with you to help you through your new construction or major renovation projects. We simplify the process for you and maximize your returns. Call Stonehill PACE today at (678) 823-9313 to learn how we can help you finance your construction project. We look forward to the opportunity to work with you.

The Advantages to Using CPACE Financing

You may be wondering if CPACE financing is right for your company. It can be difficult to decide whether this financing solution is attainable or attractive for you. As you are weighing the options, keep in mind that there are many advantages to using PACE funding for your commercial construction or redevelopment projects.

Easier Loan Approval

CPACE financing, or C-PACE, can be easily obtainable. This type of loan is less about your FICO score than many other financing options. Typically, PACE qualification is a fairly straightforward process. For example, some requirements include being up to date on any property taxes, getting an appraisal, and ensuring that you have financial statements or projections.

PACE Loans Can Be Sold with the Property

Because PACE loans are tied to the property, you won’t necessarily have to pay off the loan. If you sell your property, the loan goes to the buyer. This is a great advantage to PACE funding, as it means that you aren’t on the hook for the loan after selling your newly constructed or redeveloped property.

Repayment Is Spread Over Years

Additionally, another benefit of using CPACE financing for your project is that you can pay it off over several years. Therefore, you can make relatively small payments toward the loan if you need to. Repayment is typically in a time period between 10 to 20 years, so it will not be a huge burden on your business to quickly pay back the loan.

So, as you look at different financing options, you shouldn’t rule out PACE funding. It can be beneficial for your commercial construction projects, as qualification and repayment can be simpler than other types of loans.

If you are considering a commercial PACE loan, Stonehill Pace can help. We are a direct PACE lender and specialize in commercial funding. Our focus is on new construction and major redevelopment projects for businesses. We work with many different property types, like hotels, senior housing, and offices. Call us today at (678) 823-9313 for more information or to get started on your PACE financing approval. We are always here to answer any questions and look forward to the opportunity to serve you.

Welcome to the New Stonehill PACE Blog!

Our company, Stonehill PACE, has recently launched a new website to showcase our PACE lending services. We provide direct PACE lending for hotels, multifamily living, senior living, student housing, retail stores, offices, industrial buildings, and self-storage facilities. Our focus on new construction and major redevelopment is unique in the PACE financing industry. Our team of professionals has a wealth of knowledge and expertise that will benefit your company by handling all of the aspects of the PACE qualification process. Check back as we start posting information to our new blog.