Esoteric

Jeff Weinstein and Patrick Lampe join from the Chicago office of Sidley Austin; Morgan Lewis partner Philip Russell is relocating from the firm’s New York office.

PACE Funding Group, based in Los Gatos, Calif., recently obtained a $55 million line of credit from SunTrust Bank and Rosemawr Management and is gearing up for its second securitization later this year.

The transaction comes with a bigger prefunding account than the sponsor's prior deal, completed in 2015; the collateral is also more geographically diverse.

S&P has lowered default expectations for the $300 million of Series 2018-1 transaction, allowing the sponsor to achieve an AAA, up from A on the previous deal; Kroll is not rating the new deal.

Proceeds will be used to repay its $1.29 billion whole business securitization completed in 2014; the new transaction will boost leverage to 5.9X from 5.7x.

The initial portfolio for the $373.4 million deal consists of 55 engines and a single airframe, which represents 0.3% of the pool; airframes could rise to 10% during the reinvestment period, however.

The sponsor has excluded receivables tied to Hyatt resorts, and as a result Westin loans account for just over half the $287 million total; the remainder are from Sheraton.

Most providers of property assessed clean energy financing shoot for relatively modest credit ratings in the securitization market. But CleanFund wanted to set itself apart.

Just 5.1% of the $91 million of liens backing the transaction are vacant, down from 9.2% of the prior deal; this allowed the sponsor to borrower more heavily against the value of hte collateral.

Should cash flow for subordinate classes fall short, a debt-service coverage ratio trigger would defer interest payments and prevent a default event.