
ALC Promotes Use Of Commercial Property Assessed Clean Energy Financing Tool

Welcome back to Build Your Dream.
I love it when we find new ways to help address the world’s biggest problems and support both our investors and the projects we help become reality.
That’s exactly what happened last year. Working with our partner CastleGreen Finance (one of the family of X-Caliber companies), we have begun combining our more traditional financing approaches with C-PACE (Commercial Property Assessed Clean Energy) financing solutions.
C-PACE Defined
C-PACE was created as an innovative financing approach to encourage developers of commercial property to include components of energy efficiency, renewable energy, and water conservation in their projects. It typically is a part of a financing package reducing all the necessary equity capital for a development.
The C-PACE model is fundamentally different from traditional commercial loans in that it is secured by the property itself rather than the creditworthiness of the borrower. The “property-assessed” component of the approach means that the loan is repaid through annual property tax assessments rather than loan payments.
This approach offers multiple benefits. A key is that the loan follows the property, not the borrower. That means that the C-PACE loan is made based on the value of the developed property, not the credit worthiness of the borrower and may be freely transferred to another owner upon sale.
Other Ramifications
C-PACE financing does not impact any existing senior commercial loan’s position as a fee mortgage because of its property assessment component. That also allows the sale of the property and/or the debt without impacting C-PACE repayment.
Even in the event of a default, the C-PACE assessment does not accelerate, further protecting the senior loan. Only the delinquent amount is collected, with the property assessment continuing forward.
“C-PACE financing works in harmony with the senior lender to create a new, improved capital stack and preserves the lender’s fee mortgage position and the property’s marketability,” said Sal Tarsia, Managing Partner at CastleGreen Finance. “The key lies in C-PACE’s unique assessment-based repayment structure, which ensures that it doesn’t interfere with property’s sale or refinancing opportunities, making it a win-win for all stakeholders involved.“
Helping The Planet
Our country’s strong push toward sustainability was the reason behind the creation of C-PACE. That incentive for proactively dealing with the need for energy efficiency and clean energy is also the reason we at ALC are big supporters of the program.
Our partners at CastleGreen have been key players in creating and promoting enabling legislation all across the country. Thirty-eight states already have laws on the books allowing this financing approach, and efforts continue to make C-PACE ever more accessible to property owners.
Providing Education
I believe so strongly in the potential C-PACE financing represents that we sponsored the research and writing of a white paper on the subject. ALC’s Sierra Dong is the primary researcher and author of the 30-page piece. Thanks to the experts at CastleGreen Finance for their invaluable assistance.
I urge you to take the time to read the paper. It provides understanding of the nuances of C-PACE from every angle – borrowers, lenders, associated financiers and developers. It is a great tool to make a positive difference in our world.
It will help Build Your Dream.
John Shen
CEO & co-founder
American Lending Center
About American Lending Center:
American Lending Center Holdings (ALCH) manages 13 EB-5 regional centers sponsoring projects across the continental United States. Since 2009, ALCH has raised EB-5 capital for over 100 projects in 31 states and has been featured on the Inc. 5000 list of “Fastest-Growing Private Companies in America” for five consecutive years (2020–2024). ALCH was also ranked among “America’s Fastest Growing Companies” by Financial Times in 2021, 2022, and 2023.
American Lending Center LLC (ALC), a mission-driven California-regulated lender, is a licensed SBA 7(a) and SSBCI lender. Together, ALCH and ALC have supported the creation or retention of over 140,000 jobs in the U.S. economy, underwriting impactful projects that foster economic growth.
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