Q: How is C-PACE (Commercial Property Assessed Clean Energy) financing becoming an increasingly important part of the capital stack, especially as traditional lenders pull back amid today’s high interest rates?

A: PACE Loan Group, and the industry in general, is becoming more and more mature. When interest rates were low, we were almost exclusively thought of as a way to enhance leverage. But with today’s higher interest rates, deals are not penciling as much, and we’re also seeing a lot of traditional banks on the sidelines. When there are fewer lenders and leverage, in general, is lower, our niche is not necessarily replacing other forms of financing or equity. Rather, we are backfilling what would otherwise be senior debt.