The capital problem every building owner eventually faces

Boilers reach the end of their life. Rooftop units lose capacity. Lighting is outdated, controls are primitive, and the envelope leaks conditioned air into the street. Every one of these problems has a well-documented technical solution — and almost every one of them stalls in the same place: capital allocation.

Internal funds are scarce and compete with revenue-generating investments. Conventional bank debt is short, expensive relative to the payback of an efficiency project, and often requires guarantees the owner does not want to give. The result is a market where technically sound, cash-flow-positive projects go unfunded for years.

Property Assessed Clean Energy (PACE) was designed to break that deadlock. It is a financing structure that repays project costs through a special assessment on the property tax bill — a mechanism governments have used for a century to fund sidewalks, sewers, and street lighting. Applied to buildings, it turns energy upgrades into a long-term, property-based obligation instead of a short-term loan.

How PACE works, step by step

The structure is consistent across programs, even though details differ by state and locality:

1. Eligibility check. The property must sit in a jurisdiction with an active C-PACE program, and the improvement must be a qualified measure (energy efficiency, renewable energy, water efficiency, and — in some states — resilience).
2. Project development. An energy audit or investment-grade study identifies measures, costs, and projected savings. Programs typically require a Savings-to-Investment Ratio above 1.0 — the savings over the life of the equipment must exceed the full financed cost.
3. Capital is provided upfront. A private capital provider or program financier funds 100% of project cost at closing, including eligible soft costs. Construction proceeds.
4. Repayment through assessment. The financed amount is placed on the property as a special assessment and collected with the property tax bill, annually or semi-annually, over a term that typically runs up to 20 years and never exceeds the useful life of the installed equipment.
5. The obligation stays with the property. If the building is sold, the remaining assessments and the lien transfer to the new owner — along with the savings the improvements produce.

No personal guarantee. No credit underwriting of the owner. The financing qualifies against the property, not the borrower.

What property owners actually get

100% upfront funding

There is no equity check and no down payment. The entire installed cost — equipment, labor, and eligible soft costs — is financed, so the project begins generating savings from day one without consuming the owner's capital.

Terms matched to the asset, not the borrower

Because repayment is secured by a tax assessment — one of the most reliable collection mechanisms available to a lender — capital providers can offer longer terms and lower annual payments than conventional debt. Monthly or annual payments are frequently lower than the utility savings the project creates, which means the upgrade can be cash-flow positive from the first billing cycle.

Transferability on sale

Most commercial owners do not know how long they will hold an asset. PACE removes that objection: the balance does not accelerate on sale and does not have to be paid off at closing. The buyer assumes the assessment and receives the benefit of the improvements.

Flexibility on structure

In net-lease and multifamily settings, assessment costs are commonly passed through to tenants, which resolves the split-incentive problem that derails so many efficiency projects. Terms, payment frequency, and capital structure are negotiated transaction by transaction rather than taken off a rate sheet.

Stacking with other capital

PACE is not a replacement for a first mortgage — it is a layer that sits alongside one. It is regularly combined with conventional debt, utility incentives, tax-credit deals, and property-assessed programs for new construction.

What can be financed

• HVAC systems, boilers, chillers, and heat pumps
• LED lighting and advanced lighting controls
• Building envelope: insulation, windows, air sealing
• Building automation, controls, and energy management systems
• Solar PV, solar thermal, and geothermal
• Water efficiency and, in many states, storm hardening and resilience measures
• Chillers, compressed air, process equipment in industrial and multifamily assets

Both existing buildings and new construction are eligible in most programs, and several states allow retroactive financing — if the owner has already paid for qualifying work, it can often be reimbursed after the fact.

Where PACE is available today

C-PACE is enabled by state law and launched locally, so coverage is not uniform. More than 40 states and the District of Columbia have adopted enabling legislation, with 75 active programs operating nationwide and the count rising every year (CREFC C-PACE Primer, 2025). Cumulative C-PACE investment approached $10 billion between 2009 and the end of 2024, according to PACENation, with lending volume growing at double-digit rates over the last five years.

Ohio — where Better Buildings US is based — is one of the established markets, alongside California, Florida, Texas, Connecticut, Colorado, New York, and others. Program rules, eligible measures, term limits, and capital sources vary from one jurisdiction to the next, which is exactly why deal-level guidance matters.

How Easy PACE™ fits in

Easy PACE™, the financing program of Better Buildings US, uses the PACE framework to connect property owners with low-cost capital for commercial and multifamily properties in any area with an established PACE program. Owners get a lower interest rate, a payback period of up to 20 years, property-qualified (not credit-based) financing, an obligation that remains with the property on sale, and a flexible, negotiated transaction — with Better Buildings US managing the process end to end.

Key takeaways

• PACE finances 100% of qualified efficiency and renewable projects with no upfront capital.
• Repayment runs through the property tax bill over terms of up to 20 years, capped at equipment useful life.
• Financing is property-based: no personal guarantees, no credit-driven underwriting.
• The obligation transfers to the next owner on sale, matching financing to unknown hold periods.
• Coverage now spans 40+ states and D.C., with roughly $10 billion deployed to date.

If you are weighing an efficiency retrofit against a capital budget that will not stretch, the first question is not whether the project works — it is whether the financing structure fits the asset. PACE is usually the answer. To explore whether your property qualifies, contact Better Buildings US at (740) 807-4292 or info@betterbuildingsus.com.