Clean Fund purchases $30 million portfolio of CEFIA-financed commercial properties

The Clean Energy Finance and Investment Authority (CEFIA), Connecticut's green bank, and Clean Fund, a specialty Property Assessed Clean Energy (PACE) finance provider, has secured a portfolio of CEFIA-financed commercial property assessed clean energy transactions. The sale will fund a total portfolio of $30 million of commercial PACE benefit assessment liens financed through a conduit structure. The Public Finance Authority is the issuer of the bonds which have been purchased by Clean Fund and CEFIA. PACE allows property owners to access 100% up-front financing for 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. "The sale of this initial portfolio of PACE liens to Clean Fund is the latest step in our effort to attract and deploy private capital here in Connecticut supporting energy efficiency and renewable energy opportunities," said Bert Hunter, chief investment officer of CEFIA. "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. 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." 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 underwrite commercial PACE transactions throughout Connecticut. "We are pleased to have been selected by Connecticut's green bank and are now investing in Connecticut PACE projects," said John Kinney, CEO of Clean Fund. "The due diligence performed at the front end provides a strong foundation for sound investment opportunities. In just a year, Connecticut has moved to the front of the country when it comes to activity on PACE." CEFIA uses a technical review process and underwriting platform managed by Sustainable Real Estate Solutions (SRS) to quantify potential energy savings and to mitigate financing risk. The program has closed on 23 projects and approved an additional 10, representing an investment of $30 million across 25 municipalities. These projects include a combination of energy efficiency, clean distributed generation and hybrid projects. The portfolio represents a lifetime energy savings equivalent of $40 million. With an additional 75 projects in the pipeline, financing of up to $75 million is anticipated by the end of 2014. "The Public Finance Authority is pleased to be part of this unique and important financing that will pave the way for future critical energy efficiency projects," said Jon Penkower, program manager for the Public Finance Authority.