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CALIFORNIA STATEWIDE COMMUNITY DEVELOPMENT ASSOCIATION (CSCDA) OPEN PACE CSCDA Open PACE Program Administrators 2
CSCDA OPEN PACE APPROVED CITIES & COUNTIES (as of 03/07/19) Cities Cupertino Imperial National City City Torrance San Adelanto Danville Imperial Newark Reedley Tracy Bernardino Desert Hot Beach Newman Rialto Truckee San Diego Agoura Hills Springs Indio Norwalk Richmond Tulare San Mateo Alameda Dinuba Inglewood Novato Riverside Tustin Santa Albany Duarte Ione Oakland Sacramento Twentynine Barbara Antioch Dublin King City Oceanside San Anselmo Palms Santa Cruz Arcata El Cajon Kingsburg Ojai San Ukiah Tehama Atherton El Centro La Mesa Ontario Bernardino Union City Yuba Atwater El Cerrito La Verne Orland San Carlos Upland Azusa El Monte Lafayette Oroville San Diego Vallejo Barstow Elk Grove Laguna Oxnard San Victorville Belmont Emeryville Beach Pacifica Francisco Walnut Belvedere Encinitas Laguna Hills Palm Desert San Jacinto Walnut Benicia Escondido Lancaster Palm San Leandro Creek Berkeley Eureka Larkspur Springs San Mateo Waterford Big Bear Fairfax Lathrop Palmdale San Rafael West Covina Lake Fairfield Lemoore Paradise San Ramon West Blythe Farmersville Lindsay Parlier Sanger Hollywood Brisbane Firebaugh Lodi Piedmont Santa Yreka Buena Park Folsom Loma Linda Pinole Barbara Yuba City Burlingame Fontana Lompoc Pismo Beach Santa Yucaipa Campbell Foster City Long Beach Pittsburg Clarita Yucca Valley Carlsbad Fowler Los Angeles Placerville Santa Cruz Cathedral Fremont Los Banos Pleasant Hill Santa Counties City Fresno Madera Pleasanton Monica Ceres Alameda Galt Manteca Porterville Sausalito Chico Butte Gardena Martinez Portola Selma Chino El Dorado Gilroy Mill Valley Valley Solana Chino Hills Fresno Glendale Milpitas Poway Beach Citrus Glenn Glendora Montclair Rancho South Lake Heights Humboldt Grand Monterey Cordova Tahoe Claremont Imperial Terrace Park Rancho South San Clovis Madera Gustine Moorpark Cucamonga Francisco Coachella Marin Coalinga Hanford Moraga Rancho Stanton Mariposa Hayward Moreno Mirage Stockton Colma Mono Hercules Valley Redlands Sunnyvale Colton Monterey Hesperia Morgan Hill Redondo Thousand Concord Napa Highland Mt Shasta Beach Oaks Corcoran Riverside Hughson Napa Redwood Tiburon Cudahy Sacramento 3
PACE JURISDICTIONS NATIOINALLY C-PACE launched C-PACE legislated / in development C-PACE legislated / not yet enabled C-PACE not yet legislated More information - Program Administrator 4
RESIDENTIAL-PACE STATISTICS 5
COMMERCIAL-PACE STATISTICS 6
WHAT IS PROPERTY ASSESSED CLEAN ENERGY (PACE)? • PACE is a Public / Private partnership • Provides long term (up to 30 years), fixed-rate financing when there are few alternatives. • Property owners can finance Qualifying Improvements through voluntary non ad valorem property assessments placed on their property by a state special government or Joint Power Authority. • Finances 100% of the energy efficiency, renewable energy, water conservation, seismic improvements and the related costs without regard to credit. • The financing is collected with regular local real estate taxes and payments are amortized over the useful life of the project. 7
PACE ELIGIBLE IMPROVEMENTS RENEWABLE ENERGY IMPROVEMENTS Examples include: Charging stations, storage systems, alternative or solar energy improvements. COMMON AREA RETROFITS Examples include: HVAC, windows, roofing, lighting. GREEN ROOFS Examples include: Green roofs,, rooftop gardens, green walls. SEISMIC RETROFITS Examples include: Soft story, concrete non-ductile, accessory dwelling units WATER CONSERVATION Examples include: weather-based irrigation control, high efficiency sprinkler nozzle, artificial turf, faucets 8
PACE ELIGIBLE IMPROVEMENTS (continued) HVAC (Energy Efficiency) Examples include: Heat Pumps, Water Heaters, Chillers, Building automation, Central air conditioner, furnace, energy efficient thermostat LIGHTING (Energy Efficiency) Examples include: Indoor and outdoor lighting fixtures, lighting controls POOL (Energy Efficiency & Water Conservation) Examples include: Pool pumps, pool heaters, automatic pool covers BUILDING ENVELOPE (Energy Efficiency) Examples include: Insulation, radiant barriers, air sealing, cool wall coating DOORS AND WINDOWS (Energy Efficiency) Examples include: double and triple pane windows, applied window film ROOF (Energy Efficiency) Examples include: Solar reflective cool roof, Fluid Applied Silicon Coating System 9 * Wind Resistance Improvements only available in Florida
SOLAR 100% Financing • Engineering & Design • Permits & Inspections • Necessary Roof Improvements • Prepaid Service Contracts • Owner keeps rebates and incentives • Utilize Solar Tax Benefits • PPA may be financed in certain jurisdictions 10
LIGHTING Significant Impact in Reducing Energy Use LED Lighting • Short term expense recapture • Lighting controls add to overall energy saving • Customized and become a way to attract guests through design and color • Parking lot lighting 11
SEISMIC RETROFIT 100% Financing • Engineering & Design • Permits & Inspections • All related work • Additional projects may be eligible • Rent pass-through and local exemptions • Includes ADU’s (additional dwelling units) 12
GREEN ROOFS 100% Financing • Plants and Medium • Egress stairs/elevator • Related Roofing Work • Mechanicals and Solar improvements • Engineering & Design • Permits & Inspections • Prepaid Maintenance Contracts 13
CASE STUDY HYATT CENTRIC: C-PACE Financing as a Cost Effective Substitute to Equity The Challenge: Without a cost effective way to supplement equity, the proposed rehab and rebuild of a new upscale Hyatt Centric hotel in Sacramento, CA was at risk. Market conditions caused higher material costs to the project, increasing the equity requirement. The capital stack included a first mortgage construction loan, preferred equity, a subordinate city economic development loan and equity. The Solution: C-PACE financing was used as an alternative to raising $5.5 million of equity and an additional $5 million of higher cost floating rate debt in the capital stack. The Result: The property owner is saving an estimated $1.5 million of interest carry during the development and stabilization period of the project. The C-PACE is also reducing the amount of equity needed for the project, allowing the property owner to achieve its return hurdles without giving up an ownership stake in the property. It also removes both interest rate risk and term risk from the most critical stage of the redevelopment of the asset. $10,466,025 $1,551,065 1,037 $1,020,187 25yr FIXED RATE C-PACE FINANCING INTEREST SAVINGS OVER 3 YEARS ENERGY SAVINGS LIVES SAVED 14
CASE STUDY The Hilton Los Angeles-Financing Retrofits to Improve Performance The Challenge: 500 room hotel, built in 1984, required improvements to remain competitive. The Solution: C-PACE financing of $7 million with a 20 year term • Addresses deferred equipment maintenance • Complies with the Hilton global design standards • Improves NOI and property value The Result: • Upgraded elevators, LED lighting, HVAC and chillers, dynamic tinting glass, refrigerators, and low flow plumbing fixtures • Reached Green Seal and LEED certification standards • Reduced operating and maintenance costs $7,000,000 $335,000 $1,000,000 INCREASE Year 1 NOI 20yr FIXED RATE C-PACE FINANCING ENERGY and OPERATIONAL SAVINGS 15
CASE STUDY Kings Inn: Increasing Energy Efficiency and Lowering Operating Costs The Challenge: Kings Inn Anaheim was looking for a way to reduce energy consumption, go green, modernize and improve property cash flow, without tying up funds from capital expense reserves. The Solution: C-PACE financing of $1 million with a 25 year term Covering 100% with no upfront costs • The Result: • Upgraded cool roof and solar panels led to increased energy efficiency and a “greener” more modern hotel. • $2,723,155 projected energy savings over 25 year warranty • Expected increase in property value 16
NEXT STEPS • Staff prepares PACE Program Report and multi provider Resolution • Appropriate City Departments approve PACE • City Manager’s Office • City Attorney’s Office • Department of Sustainability Office (if applicable) • Department of Economic Development Office (if applicable) • CSCDA Open PACE Resolution placed on City Council’s Regular Agenda • City approves CSCDA Open PACE multi-provider (commercial only) Resolution at City Council meeting (sometimes even approved on Consent Agenda) • Approved CSCDA PACE Program Administrators can begin to market and provide PACE financing to property owners immediately • If the City so desires, publish PACE on the City’s web site, city mailings or e-news letters. (for example, see https://www.ci.emeryville.ca.us/1260/PACE-Programs) 17
CSCDA OPEN PACE QUESTIONS? 18
For more information, please visit our website at http://cscda.org/Open-PACE or https://www.counterpointesre.com/ or contact C.J. De Santis Head of Government Relations Counterpointe Sustainable Real Estate 561.409.0343 cj@counterpointees.com 19
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