Deer Valley, Utah, September 19, 2025
News Summary
A new large-asset C-PACE financing product provides fixed-rate, balance-sheet funded capital intended as an alternative to bridge loans and mezzanine debt. The structure lets borrowers defer debt service for up to four years during construction or lease-up and offers flexible prepayment, including par prepayment after five years and reduced penalties beginning in year three. The product launched with a $63.3 million C-PACE financing for a mixed-use resort in Deer Valley, covering roughly 42% of construction costs. It targets institutional-scale projects, helps lower weighted average cost of capital, and supports energy upgrades and construction stabilization.
PACE Equity rolls out large-asset C-PACE product offering fixed-rate, lower-cost short-term capital
A national commercial C-PACE lender has launched a new financing product aimed at large development and recapitalization projects, offering fixed-rate loans, deferred payments during construction or lease-up, and flexible prepayment options. The product is built on the C-PACE model and is designed as a lower-cost alternative to bridge or mezzanine loans for owners who need short-term capital that can be refinanced without heavy exit costs.
Key facts up front
- Product type: Large-asset C-PACE financing with fixed rates.
- Payment relief: Debt service may be deferred for up to four years to cover construction or lease-up phases.
- Prepayment: Options include prepayment at par on shorter durations, with the ability to prepay at par after five years and modest penalties beginning as early as year three.
- Pricing: Spreads start in the high 200s over the 10-year U.S. Treasury.
- Proof of concept: A $63.3 million C-PACE financing package closed for a mixed-use luxury resort in Deer Valley, Utah.
Why the product matters now
The new solution arrives as the commercial real estate market faces a wave of maturing debt and elevated interest rates. Nearly $1 trillion in commercial debt is set to mature in 2025, creating pressure on developers to reach temporary, often costly, financing arrangements. The product aims to give sponsors breathing room by providing stable, fixed-rate capital that can replace expensive short-term bridge or mezzanine debt and be refinanced when market conditions improve.
How it works and use cases
The structure follows the established C-PACE framework but is scaled for larger assets. Typical uses include completing construction, covering cost overruns, funding interest reserves, stabilizing newly built properties, and reshuffling capital stacks mid-development. In some cases, the financing can be used to partially pay down or refinance senior debt to extend loan timelines and avoid immediate refinancing pressure.
Proof: SkyRidge Resort recapitalization in Utah
The lender applied the product to a mid-construction recapitalization for the SkyRidge Resort in Deer Valley. The $63.3 million financing covered about 42% of the project’s construction budget, helping fund completion of the Stelle Lodge, clubhouse and related resort amenities. The package enabled the developers to lower the weighted average cost of capital while finishing construction and working toward stabilization.
SkyRidge’s scope includes a Topgolf®-branded 18-hole golf course, a six-story Stelle Lodge anchoring the community, a clubhouse, event spaces, an equestrian center with private trails, fine dining with an Argentinian culinary theme, a rooftop deck and bar, spa, pool, fitness center, and private community amenities. The developer also qualified for a proprietary low-carbon certification that secured lower rates and additional savings by adding high-performance upgrades to the building envelope, electrical systems, HVAC, lighting, and plumbing.
Market acceptance and lender perspective
Larger C-PACE deals have become more common as institutional borrowers and senior lenders grow more comfortable with the product. Banks that once viewed C-PACE with skepticism increasingly treat it as an accretive tool that can help secure large deals and protect lender relationships without resorting to loan participations. The lender behind this product is a balance sheet funder with committed capital positioned to write larger checks for bigger assets.
Drivers of adoption
- Regulatory and bank behavior: Increased regulatory scrutiny has pushed some banks to reduce leverage or shorten loan terms, creating gaps C-PACE can fill.
- Interest-rate environment: Long-term fixed-rate C-PACE is attractive in both low- and high-rate markets because it locks in rates for 20–30 years and eliminates refinance risk.
- Recapitalization use: Awareness of C-PACE as a recap tool for cost overruns, interest reserves and capital stack reshuffles has risen, driving more adoption.
Scale and reach
C-PACE programs are now enabled in 40 states, and total C-PACE lending reached nearly $10 billion by the end of 2024. Industry participants say C-PACE’s versatility makes it useful across asset types, from hospitality and multifamily to office and retail.
What this means for developers
For sponsors facing tight capital markets, the product offers a way to complete projects without immediate refinance risk and to lock in long-term, competitive financing. The deferred-payment feature reduces cash pressure during construction or lease-up, while the prepayment terms let owners exit the financing on favorable terms once market conditions or project cash flow improve.
Bottom line
The new large-asset C-PACE offering is a targeted response to current market strains: it combines fixed-rate, longer-term pricing with short-term flexibility for borrowers. The SkyRidge deal provides an early example of how the product can be used mid-construction to lower a project’s cost of capital and support stabilization without an immediate refinance.
FAQ
What is the new C-PACE product?
It is a large-asset C-PACE financing solution that offers fixed-rate loans, deferred payments for up to four years, and flexible prepayment options designed for big development and recapitalization projects.
Who can use this financing?
Owners and developers of large commercial projects currently under construction or planned new developments can use it to complete construction, cover overruns, fund interest reserves, or reshuffle capital stacks.
How does prepayment work?
The product allows prepayment at par on certain short-duration windows and generally permits prepayment at par after five years. Minimal penalties may apply starting as early as year three.
What are typical pricing levels?
Pricing examples include spreads starting in the high 200s over the 10-year U.S. Treasury, though final terms vary by deal and credit profile.
Where is C-PACE available?
C-PACE programs are active in 40 U.S. states. Availability can depend on local program rules and project eligibility.
Is C-PACE accepted by senior lenders?
Senior lenders have grown more accepting of C-PACE and may view it as a way to structure larger deals or preserve client confidentiality compared with participations.
Key features at a glance
| Feature | What it means |
|---|---|
| Fixed-rate financing | Locks in long-term interest rates to reduce refinance risk. |
| Deferred payments | Allows debt service to be delayed up to four years during construction or lease-up. |
| Flexible prepayment | Prepay at par after five years; limited penalties may apply starting year three; short-duration par prepay windows available. |
| Competitive pricing | Spreads starting in the high 200s over the 10-year U.S. Treasury (deal dependent). |
| Use cases | Construction completion, cost overrun coverage, interest reserves, recapitalization, partial or full senior debt refinancing. |
| Geographic reach | Available where C-PACE programs exist; enabled in 40 states. |
| Proven example | $63.3M for SkyRidge Resort in Deer Valley, Utah, covering ~42% of construction budget. |
| Energy certification | Qualification for proprietary low-carbon certification can secure lower rates and additional savings through efficiency upgrades. |
Deeper Dive: News & Info About This Topic
Additional Resources
- Boston Real Estate Times: Pace Equity unveils flexible large-asset financing product
- Wikipedia: Property-assessed clean energy (PACE)
- Mile High CRE: Pace Equity launches flexible large-asset financing product
- Google Search: C-PACE financing
- ConnectCRE: Pace Equity Group’s Andrew Freter on C-PACE as a financing source
- Google Scholar: Commercial PACE financing
- ConnectCRE: Deer Valley resort obtains $63.3M C-PACE loan
- Encyclopedia Britannica: Property-assessed clean energy
- PR Newswire: Petros PACE Finance closes $153M C-PACE deal
- Google News: C-PACE financing
Author: Construction TX News
TEXAS STAFF WRITER The TEXAS STAFF WRITER represents the experienced team at constructiontxnews.com, your go-to source for actionable local news and information in Texas and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Texas Construction Expo, major infrastructure unveilings, and advancements in construction technology showcases. Our coverage extends to key organizations like the Associated General Contractors of Texas and the Texas Building Branch, plus leading businesses in construction and real estate that power the local economy such as Austin Commercial and CMiC Global. As part of the broader network, including constructioncanews.com, constructionnynews.com, and constructionflnews.com, we provide comprehensive, credible insights into the dynamic construction landscape across multiple states.
