Record C-PACE Deals Mark Shift in CRE Financing

A wave of record-setting commercial property assessed clean energy (C-PACE) deals in 2025 and 2026 are pushing the once-niche financing tool into the commercial real estate (CRE) mainstream.

For office conversions, Post Brothers secured a $465 million C-PACE loan for The Geneva — a Washington, D.C. office-to-residential conversion — in its largest transaction to date. The project will convert a 604,000-square-foot office complex in northwest D.C. into a 15-story, luxury, LEED-certified residential building featuring 429 market-rate units, 42 extended-stay rentals and 61 affordable housing units, as well as 57,000 square feet of commercial space.

Meanwhile, in Kansas City, Mo., Patmos Hosting took out $100 million to convert a building into a tech hub and AI campus that will provide coworking and event spaces.

C-PACE is being used in hospitality funding, as well, with Nuveen Green Capital closing a $290 million loan for the Pendry Hotel and Residences — a 38-story, mixed-use hotel and residential tower in Tampa, Fla., that pairs 220 hotel rooms with 200 condos.

Additionally, in Las Vegas, Peachtree funded a $176.5 million retroactive loan tied to Dreamscape’s renovated 2,520-room Rio Hotel & Casino. It’s the largest credit transaction in Peachtree’s history and among the biggest of its kind nationally.

New construction also has access to C-PACE funds with CounterpointeSRE providing $156 million for Echelon Studios — two high-end film and television production studios in Brooklyn, N.Y., developed by Bungalow Projects and Bain Capital Real Estate.

The C-PACE tool has earned attention because it addresses a stubborn problem — how to fund major capital improvements when senior debt is tight and equity is costly. During stretches of elevated interest rates, C-PACE has filled gaps that would otherwise have derailed workable projects. The tool also allows owners to fund energy efficiency, renewable energy, water and resiliency upgrades through a fixed-rate tax assessment, rather than drawing on their own balance sheet.

Currently, C-PACE policies exist in 40 states across more than 32 active programs. Alabama joined recently, and New Jersey closed its first C-PACE loan — $45.5 million for the Island Waterpark in Atlantic City, N.J.