PACE financing is an ideal replacement for mezzanine financing or equity debt. CPACE will reduce your project's capital cost and offer longer-term solutions for construction debt in a wide range of industries.
Mezzanine financing vs. CPACE
Mezzanine debt arrangements typically:
- Span three to five years
Discover how CPACE financing offers lower rates and longer terms than mezzanine debt or preferred equity.
- Carry interest rates between 10% and 14% or higher
- Require a balloon payment of interest and monthly payments by borrowers
By contrast, PACE financing arrangements:
- Are available for up to 30 years
- Generally feature interest rates starting at 6.00%
- Are non-recourse
PACE funding arrangements also allow the pass-through of required payments to tenants, renters, or hotel guests and are paid annually or semi-annually. Depending on your requirements, you may also be able to delay your first payment by up to two years.
Commercial PACE Financing vs. Preferred Equity
CPACE loans differ from preferred equity arrangements because they do not confer an equity investment in the company or entity that owns the property. Instead, PACE financing is designed to:
- Attach to the property itself
- Provide up to 35% of its value to fund construction projects that meet the minimum requirements
Learn more about CPACE Financing or contact Peachtree's CPACE team.
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