The Clean Energy Finance and Investment Authority (CEFIA), Connecticut’s green bank, has completed the first securitization of a $30 million portfolio of commercial Property Assessed Clean Energy (PACE) liens.
The deal follows Deutsche Bank's March breakthrough securitization of residential PACE liens for the Western Riverside Council of Governments.
The Connecticut Public Finance Authority is the issuer of the bonds, which have been purchased by Clean Fund and CEFIA.
Connecticut’s PACE program was launched in 2013 and is active across 80 municipalities in the state. CEFIA established a $40 million financing warehouse to finance commercial PACE transactions throughout Connecticut.
PACE allows property owners to finance 100% of the cost of energy efficiency and renewable energy improvements on their buildings. A lien is attached to the building and the owner repays the investment through an additional charge on their property tax bill.
“Some of the greatest value of the sale has been our enhanced understanding of how private capital providers currently value these low-risk, secure transactions,” said Bert Hunter, chief investment officer of CEFIA in the press release. “The bottom line is that PACE is working for building owners who are seeing energy improvements deliver substantial savings and PACE is working for investors who see the security of the financial structure of PACE and are willing to invest in Connecticut.”
The program has closed on 23 projects and approved an additional 10, representing an investment of $30 million across 25 municipalities. With an additional 75 projects in the pipeline, financing of up to $75 million is anticipated by the end of 2014.