Pace Loan Group

june 10, 2024

New Jersey: C-PACE's next frontier

New Jersey is not often thought of as a frontier in commercial real estate development, but thanks to pending legislative changes in the Garden State, PACE Loan Group (PLG) is ready to help developers forge a new path through C-PACE financing.  C-PACE loans are an innovative financing tool to help developers save money and get projects across the finish line in today’s market.


What is C-PACE (Commercial Property Assessed Clean Energy)? 

• Low-cost, long-term, non-recourse financing for energy-efficient building improvements.  New construction, adaptive reuse, and projects completed in the last one to three years are eligible for C-PACE.

• Loans cover 100% of eligible improvements and self-amortize, up to 30 years in some locations.  Funding generally covers 25% to 30% of the total project cost. Legislated on a state-by-state basis; currently available in over 35 states including New Jersey.


New Jersey C-PACE Update: 

• C-PACE has been available in New Jersey since 2020, but the current program is restrictive and therefore not many projects have been financed.

• Pending changes will allow for C-PACE on new construction projects and will increase the LTV limit to 35% in some cases, which will make the program significantly easier to qualify for.  We expect these changes to take hold later in 2024.


C-PACE qualification is easier than you think: 

• Modern building components all have energy efficiency elements, which can include HVAC, windows, LED lighting, roof, and more. All these elements are PACE-eligible.

• Building and/or renovating to code generally meets C-PACE financing thresholds, making it relatively easy to qualify.


C-PACE helps in multiple scenarios:

• If your construction loan proceeds are short, C-PACE can help. 

     o   PLG’s C-PACE loans can eliminate the need for additional equity, C-PACE can also be used in place of a traditional bank participant, widening your list of potential lenders to include local banks and debt funds. 

• If your project is not yet stabilized, C-PACE can help. 

     o   PLG’s C-PACE loans fund bridge-to-bridge scenarios for (1) cost overruns, (2) construction loan paydowns, and (3) funding gaps when your “lease-up” loan is short on proceeds.

• If your non-bank construction loan quote is expensive, C-PACE can help. 

     o   Non-bank, non-recourse loans are usually cost prohibitive.  PLG’s Low-cost C-PACE proceeds can blend down your overall cost of capital and make your project feasible.



As New Jersey’s C-PACE program evolves, C-PACE financing is well positioned to help developers and owners complete their capital stacks.  Contact PLG today for a quote on your next project.


Loren Biller


(917) 346-1397


See if C-PACE works for your project. 

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