King County (Wash.), Daniels Real Estate and Petros PACE Finance, a provider of Commercial Property Assessed Clean Energy (C-PACE) financing, closed a $19 million transaction providing low-cost financing for key improvements at the Lodge at St. Edward State Park in Kenmore, Wash. near Seattle. The deal is also the first C-PACE financing in Washington.
A historic landmark listed in the Washington Heritage Register and the National Register of Historic Places, the Lodge at St. Edward State Park has 84 rooms, a spa, bars and a restaurant as well as meeting and event spaces.
“The former seminary building had sat empty for over 40 years and it was estimated that it would cost over $15 million just to keep it from falling in on itself,” said Kevin Daniels, owner of the Lodge and Seattle-based Daniels Real Estate, in a statement. “We had significant challenges in bringing the historic building back to use and enhancing the building with modern amenities and conveniences of a boutique Lodge. The C-PACER financing was instrumental in making it possible for energy related improvements and updated HVAC systems. It helped to preserve the historic building through a new reuse that enables park users and Lodge guests to enjoy this beautiful building inside and out.”
C-PACE is the broader term used nationally, and King County’s program, C-PACER, adds to the definition: Property-Assessed Clean Energy and Resiliency.
“C-PACER will help us create the innovative solutions our region needs to re-engineer the built environment to be more sustainable, energy-efficient, and prepared for climate impacts,” said King County Executive Dow Constantine. “King County will be one of the largest local governments in the nation where owners can access this innovative low-interest financing for climate and seismic upgrades of commercial and multi-family buildings.”
C-PACE is a long-term financing product secured by a property tax assessment that provides developers with a more affordable alternative to mezzanine debt and equity. In Washington, this low-cost funding can be used for qualifying seismic improvements, energy and water efficiency, renewable energy and energy storage, fire protection, flood readiness and similar work for hotel, office, retail, industrial, apartment, mixed-use and other commercial real estate. C-PACE will be available elsewhere in Washington as local jurisdictions develop administration programs.
“Commercial property owners and developers across the State of Washington have been eager for C-PACE financing to become available, and we’re excited that this debut in King County will open the door for this innovative, trusted tool that’s operating in 32 states to date,” said Mansoor Ghori, CEO of Austin, Texas-based Petros PACE Finance, a national provider of C-PACE.