Capital markets warm to C-PACE financing amid growing stress

The spike in interest rates and the consequent disruption throughout real estate capital markets over the last 18 months is generating newfound interest in C-PACE financing.

In cases where cost overruns, stabilization delays and declining values threaten the ability to refinance construction loans, developers are tapping C-PACE retroactively for a much-needed slug of so-called “rescue capital,” says Rafi Golberstein, CEO of the PACE Loan Group, a direct lender of C-PACE based in Minneapolis, Minn. Typically, developers are using the proceeds to pay down debt and fund reserves to secure loan extensions or modifications.