Adaptive reuse describes the repurposing of an existing building for a new use, like transforming an old train station into retail stores or a food hall. Adaptive reuse is an important sustainability strategy and has become especially relevant given the post-pandemic office market. Record low occupancies and the ongoing housing shortage have created a unique opportunity for building owners to convert vacant office buildings into flourishing multifamily projects.

Converting properties from office to residential can be a difficult and expensive process. Because the two asset classes have different light and safety requirements, retrofitting offices to meet residential standards involves significant renovations and often structural modifications. Despite the potential for revitalizing underused properties, the cost and complexity of these projects have limited the number of conversions to date.

But PLG is here to help! C-PACE provides long-term, low-cost financing for building systems and components that make a project more sustainable or resilient. And as it turns out, PACE can finance many costs involved with office to multifamily conversions, such as: an upgraded electric system and LED fixtures, new plumbing for kitchens and baths, efficient HVAC equipment, operable windows, and new elevators.

One recent adaptive reuse project that PLG financed was Infiniti Lofts, where a closed hotel was converted to workforce housing. The $13.8 million in C-PACE financing contributed to energy conservation and renewable energy measures for the 151-unit property near Orlando, Florida.

As banks continue to pull back, C-PACE can step up and get these projects funded. Our financing is different from a traditional loan because it is secured by a fully assumable special assessment and repaid alongside real estate taxes. C-PACE financing can reduce the upfront cost burden and spread payments out over 25+ years, making it easier for developers to undertake ambitious adaptive reuse projects.