Commercial Real Estate

PACE Financing

Commercial PACE (Property Assessed Clean Energy) is a cost-competitive way for organizations to finance energy efficiency, renewable energy, water conservation, mechanical system replacement, and other upgrades to new and existing buildings. Messerli Kramer’s Commercial Real Estate attorneys help clients secure PACE loans to pay for new heating and cooling systems, lighting improvements, solar panels, wind energy systems, structural repairs, insulation, and more for almost any property – commercial, industrial, non-profit, or agricultural.

In addition to providing a readily available source of financing for these specific aspects of redevelopment and new development, property owners use PACE to also lower utility bills and contribute equity following completion. PACE pays for 100 percent of a project’s hard costs and much of the engineering, permitting, project management, and other soft costs with low fixed interest rates up to 20 years with debt payment added to the property’s tax bill as a special assessment similar to new roads and infrastructure. Commercial PACE financing automatically stays with the property upon sale and is part of the taxes that can be assessed to tenants in traditional triple net lease situations. However, financing is off-set by savings in Common Area Maintenance (CAM) and may result in no net increase per square foot of rent paid.

Representative Experience

Represented Go Wild, LLC to secure $6.74 million in PACE financing as part of its capital stack for the Treasure Island Center redevelopment project in Saint Paul, Minnesota.
Represented owners in creating the PACE Loan Group, LLC (PLG), a private PACE Lender working with the City of Saint Paul Port Authority to provide private PACE financing for projects throughout Minnesota that utilize the special assessment process.
Represented large retail landlord in southwest Minnesota to secure and utilize PACE financing to provide new mechanical components, new insulation, new roof, and solar energy collection resulting in increased income to the owner.
Represented multiple non-profit entities, including churches, charter schools, museums, and low income housing projects in replacing market-rate financing with PACE financing for upgrading heating/cooling, lighting, structural repair, and alternative energy installations and productions.