Harrington Place, a 350-unit multifamily community in Ferndale, Washington, from developer Grandview North.
Bayview PACE Harrington Place, a 350-unit multifamily community in Ferndale, Washington, from developer Grandview North.

Harrington Place, a 350-unit multiphase apartment community in Ferndale, Washington, is getting a boost through an innovative financing package—a combination of traditional construction financing and Commercial Property-Assessed Clean Energy (C-PACE) funding.

Bayview Asset Management funded the senior portion of the debt stack for developer Grandview North, with Bayview Pace providing $12 million in C-PACE funding and affiliate Oceanview Life and Annuity Co. bringing in $45 million of construction financing. In addition, Hickory CRE Lending provided $20 million in mezzanine debt.

This is Bayview’s first C-PACE financing in Washington. C-PACE is a new financing tool that offers flexibility and beneficial terms for qualified improvements in energy, lighting, water, building envelope, and other resilient components. According to Bayview, it has been approved through legislation in 38 states and is gaining popularity among real estate owners.

“We’re excited to be working with a strong project sponsor like Grandview, in a state where C-PACE is newly approved and gaining momentum,” said Jason Clouet, vice president of Bayview PACE. “Packaged with construction or bridge financing, C-PACE is an ideal solution for property owners to make energy-efficient and renewable building upgrades, fund new construction, and provide recapitalization funding toward recovery from the pandemic.”

The mortgage broker that helped arrange the transaction was Seattle-based CapNorth. “In today’s lending environment, it takes multiple lenders and creativity to achieve higher leverage,” said CapNorth managing partner Zach Goodwin. “Adding a portion of PACE financing to the capital stack helped take some interest rate risk off the table while also lowering the blended cost of capital. We were pleased on the execution of all three capital providers.”

Harrington Place, in northwest Washington between Vancouver and Seattle, is under construction. Once completed, the 11-building community will offer residents a wealth of amenities, including indoor and outdoor sports courts, a fitness room, a game room, a party room, a lobby, a lounge, a business suite, a craft room, an outdoor patio with grills, and a playground.

Unit interiors will feature quartz countertops and backsplashes, custom wood cabinets, stainless steel appliances, and full-size washers and dryers.

Bayview announced its first combo-finance package with C-PACE funding in February for Renegade Apartments, a student housing project with retail, in Tallahassee, Florida.