Purpose-Build Product Addresses Demand for
Cost-Effective Financing for Condo Development
Initial Focus on High-Growth Markets Including
Miami, Southern California and
Other Metro Areas
AUSTIN,
Texas, May 16, 2024 /PRNewswire/ -- Petros PACE Finance (Petros), the largest C-PACE
provider in the country and leader in innovative structured
finance, today announced a new C-PACE financing product designed to
support new construction and development of condominium (condo)
projects. This innovative solution opens up a new market for Petros
and meets the ever-evolving needs of real estate developers and
sponsors in high-growth cities around the country.
"We are very excited about this product innovation which solves
a long-standing issue for the condo development community," said
Mansoor Ghori, CEO and Founder of
Petros PACE Finance. "Our team was able to 'crack the code' and
develop a mechanism that allows real estate owners and developers
the ability to capitalize on the unique tax-lien status of C-PACE
loans in a complex condo structure. Developed in conjunction
with some of our largest partners, this new product allows for
affordable, reliable C-PACE financing for condo development
projects, driving down costs and assisting condo developers in
unlocking the value inherent in their assets."
C-PACE debuted in the early 2000's as an assessment-backed lien
financing solution, providing access to funds for integrating
energy-efficient features into both new construction and property
improvement projects. It offers flexibility and support for
developers looking to add to their new construction capital stack
or for owners to access as retroactive financing. Initially, C-PACE
encountered challenges with condo projects due to its traditional
focus on commercial properties with single commercial tax liens --
unsuitable for residential condos. Additionally, its long-term,
fixed-rate structure conflicted with the typical condo development
model, where debt is repaid out of unit sale proceeds.
Despite the challenges posed by rising interest rates and the
recent economic downturn, the demand for condos and other housing
units continues to rise. However, there is a disparity between this
demand and the current development landscape. To meet this market
need, Petros activated its deep network of PACE program
administrators, commercial real estate investors, and legal counsel
to design a viable solution for residential condo developments.
This uniquely tailored product will allow Petros to offer:
- A structure that works for all stakeholders involved, including
developers, mortgage lenders, and the final residential owner.
- Fixed-rate financing that can be repaid as individual condo
units are sold.
- Flexible repayment and pay-down parameters that integrate the
standard pay-down requirements of mortgage lenders on condo
projects – allowing for repayment in as short as 3-4 years, rather
than the traditional 25 to 30-year expectation.
"As a leading full-service commercial real estate capital
advisor and lender, we are energized to work with Petros and
incorporate C-PACE financing in our residential condo construction
and development assets. This solution is long overdue and we
are excited about the opportunity to support the growth of
sustainable development by delivering impactful solutions for our
clients," said Adam Lipkin, Vice
President at Greystone Capital Advisors.
"Petros' new condo C-PACE financing solution presents a novel
method to meet the demand for cost-effective financing for condo
developments, traditionally burdened by high debt costs. This
accessible offering holds significant promise for addressing the
financial needs of our clients, specifically in urban cores such as
Miami, San Francisco, and Los Angeles," said Brennen Brown, Managing Director at DA
Davidson.
C-PACE eligibility varies by state and is currently available in
35 states and Washington, D.C.
Petros, headquartered in Austin,
Texas, is prepared to offer their new condo financing
product nationwide, with a focus on states featuring strong urban
markets such as California,
Florida, and Texas. To learn more about utilizing C-PACE
for condo development, visit:
https://petros-pace.com/condominiums/.
About Petros PACE Finance
Petros PACE Finance, LLC is the national leader in the C-PACE
marketplace, dedicated solely to providing long-term C-PACE
financing to commercial property owners seeking to lower energy
costs, reduce their carbon footprint and increase property values
and meet environmental, social and governance (ESG) goals. The
company is a platform portfolio investment of Apollo Global
Management. Its leadership team has decades of executive-level
experience in private credit and structured finance, with direct
long-term institutional investor relationships. With billions in
committed capital, Petros is able to close transactions in eligible
C-PACE markets nationwide. To learn more about Petros PACE Finance
visit our website at www.petros-pace.com.
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SOURCE Petros PACE Finance, LLC