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BCT Architects is now BCT Design Group!
BCT Architects has joined forces with DDG (Development Design Group) and is pleased to announce the formation of BCT Design Group.
June 9, 2020
The construction sector, as vulnerable to stay at home orders as any other industry, was greatly impacted in the last two months. More than 40% of construction firms reported layoffs in April (AGC) resulting in 975,000 lost jobs, or 13% of the workforce. The total work output decreased by 16% when inclusive of lost productive hours (Engineering News-Record). Ed Zarenski of Construction Analytics, estimates that the sector will not regain pre-COVID levels of robustness until 2023.
Two areas of the sector that COVID-19 will continue to depress are the development of new projects and the completion of projects already underway. Uncertainty among investors, stay at home orders, market depression, and other industry factors currently prevent widespread construction and render investment streams insufficient or unavailable. For developers who need to secure gap financing to complete the last 0.5 to 1 million dollars in a capital stack, C-PACE may be a potential avenue for immediate, long-term financing. For main street businesses, C-PACE financing could also be used to cover the costs of requisite maintenance on appliances that need servicing or to be replaced. The flexibility that C-PACE financing offers and the long term of repayment could be very beneficial for a wide variety of borrowers in the current financial circumstances. Two recent C-PACE projects closed through the MD-PACE program illustrate some of these benefits.
The first example of the competitiveness of C-PACE financing is the Frederick Indoor Sports Center (FISC). This 65,000 square foot sports facility is a fixture of Frederick County life, where many locals exercise and compete in soccer tournaments. However, the energy requirements of such a space strain the facility’s resources, so the managers looked into utilizing the rooftop for solar energy production. They sought out the services of the MD-PACE program, and with the C-PACE capital providers, Dividend Finance and LordCap PACE, and solar contractor, Sustainable Energy Systems, were able to finance entirely the costs of installing over 1,300 solar panels, offsetting their need for electricity by 100%. This project is an excellent example of the savings potential of using C-PACE financing to invest in solar: the savings to investment ration (SIR) is 1.72, meaning that the project is expected to save over $1.5 million in electricity costs over the term of the financing whereas the the project cost was less than $1 million.. The financing will be repaid over a 20 year term. The Frederick Indoor Sports Facility will continue to be a beloved community building, not only as a recreational facility, but as a local example of the attractiveness of clean energy.
Another property that partnered with the MD-PACE program is Brown’s Arcade in Baltimore. Brown’s Arcade is a historically significant site, having first been constructed in the late 19th century. Since then it has had many occupants and uses; currently it is undergoing redevelopment into a mixed-use space for affordable apartments, restaurants, and businesses. Some architects say that the most environmentally friendly building is the one that is already built, the point being that sourcing raw materials, transforming them into building components,
transporting them to the site, and construction comprise a hidden “price tag” of environmental harm for a new building. It is better, these experts say, to make retrofits to a standing structure. This is the case in Brown’s Arcade, where the developers opted to make improvements financed through C-PACE to increase the efficiency of the units inside, including the lighting, building envelope, and HVAC system. C-PACE financing contributed to the redevelopment of one of the state’s architectural treasures.
The MD-PACE program provides access to financing for clean energy and energy efficiency investments in commercial properties across the state. It is sponsored by the Maryland Clean Energy Center (MCEC), a corporate instrumentality of the state of Maryland which advances the adoption of clean energy, energy efficiency products, services and technologies. MCEC leverages private capital to help homeowners, businesses, and government entities reduce energy costs.
Thank you to our Gold Sponsor, Pace Financial.
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