Going Big with C-PACE: Larger Transactions, Greater Acceptance

As the C-PACE industry continues to mature, more and more large transactions are happening. According to research from the industry trade group PACENation, over 100 C-PACE loans of $10M or more have been originated since 2017.  In just the past two years, all five of the largest C-PACE loans were originated, with each deal being over $150M.  During that same period (2023-2024), 12 of the top 20 all-time largest loans were also funded, showing how C-PACE continues to gain momentum, even in a constrained rate environment.

PACE Loan Group (PLG) has seen a major uptick in requests for larger C-PACE loans in the past one to two years. This marks an extraordinary evolution in our business and PACE industry as it becomes more widely accepted among big industry players. Smaller developers and investors were the initial adopters of C-PACE, as they are creative by nature and are more apt to utilize alternative financing options, but now shops like JLL and CBRE are working with this flexible financing tool. 

PLG’s loans have always been used to make projects work by adapting to the state of the market. For example, in stronger markets, PACE acts as an equity reducer and IRR juicer by subbing out more expensive mezz debt and/or pref equity, but in weaker, more illiquid markets, PACE works by filling in senior loan proceeds gaps, blending down the cost of expensive bridge debt, and recapitalizing transactions. Due to PACE’s flexibility and growing industry prominence, larger investors are catching on.  C-PACE’s inherent benefits – long terms (up to 30 years), fixed rates, and flexibility– are a great tool for sophisticated investors trying to optimize and fill gaps in their capital stacks. PLG is seeing more and more institutional investors get involved, and we welcome their participation.

PLG has an industry-leading team to help facilitate larger transactions, including our new capital markets team member, Eizaan Khan, who previously worked at Morningstar DBRS.  Structuring complex C-PACE deals and navigating the rating process requires a unique skill set that PLG’s team possesses, as we only lend C-PACE, and our entire loan process is completed in-house.  Our originators all have deep experience from outside of C-PACE, including CMBS lending, banking, bridge lending, and preferred equity investing, and work with their clients throughout the loan process. PLG’s organizational know-how is a major advantage for our borrowers, helping them use C-PACE to optimize their larger transactions. 

 

 

Contact PLG today to discuss your next development transaction:

Loren Biller

SVP, Originations

PACE Loan Group

loren@paceloangroup.com