C-PACE Financing Advisory

C-PACE is a government-enabled financing mechanism that allows commercial property owners and developers to finance energy efficiency, renewable energy, water conservation, and resiliency improvements through a long-term assessment attached to the property — not the borrower. The assessment is repaid through the property tax bill over 10–30 years, making it a form of long-duration, fixed-rate financing that sits in the capital stack alongside (or in some structures, ahead of) senior debt.

For ground-up construction, C-PACE can finance the incremental cost of building to energy-efficient standards — insulation, HVAC systems, windows, roofing, solar, and other qualifying improvements. In many states, eligible costs can represent 15–30% of total hard costs, meaning a $5M construction project might generate $750,000 to $1.5M in C-PACE proceeds.

C-PACE is currently available in 38+ states and the District of Columbia. The specific eligible costs, maximum financing amounts, and lender consent requirements vary by state and by lender — which is exactly why modeling it correctly matters so much.

The most common reason developers fail to use C-PACE is not eligibility — it's execution. Senior lenders are often unfamiliar with C-PACE, concerned about the super-lien position of the assessment, or simply unwilling to engage without a clear intercreditor framework. Many developers approach their lender with C-PACE as an afterthought, after the loan terms are already set — and get a flat no.

The correct approach is to model C-PACE into the capital stack from the beginning, present it to the senior lender as part of the initial financing package, and provide the lender with a clear intercreditor agreement template that addresses their specific concerns. When done this way, lender consent rates are significantly higher — because the lender sees C-PACE as reducing their exposure, not adding risk.

Bonica Capital Advisory manages this entire process — from initial eligibility assessment through lender presentation and intercreditor structuring. We have modeled C-PACE into capital stacks for ground-up construction, adaptive reuse, and commercial renovation projects across multiple states.

Our C-PACE advisory engagement begins with an eligible cost assessment — a detailed review of your project's construction budget to identify every line item that qualifies for C-PACE financing under your state's program rules. This is not a rough estimate; it is a line-by-line analysis that maximizes your eligible basis while staying within program guidelines.

We then model the C-PACE proceeds into your full capital stack, showing the net effect on your senior debt sizing, your equity requirement, and your overall project returns. We run the analysis with and without C-PACE so you can see the precise economic benefit — and make an informed decision about whether to pursue it.

Finally, we prepare a lender presentation package that explains C-PACE in terms your senior lender understands, addresses the intercreditor concerns they're most likely to raise, and provides a draft intercreditor agreement framework as a starting point for negotiation. This package dramatically increases the probability of lender consent.

C-PACE programs vary significantly by state. Some states have robust, well-funded programs with streamlined approval processes and broad lender familiarity (California, Texas, Florida, Colorado, New York). Others have newer programs with more limited eligible cost categories or smaller maximum financing amounts. A few states have programs on the books but limited active lenders.

We work with developers across the country and maintain current knowledge of program rules, eligible cost categories, and active C-PACE lenders in each state. When you submit your deal, we'll give you a clear picture of what's available in your market and what you can realistically expect to achieve.