Bayview PACE

Just blocks from Florida State University, Bayview Asset Management has closed an innovative $63 million loan combination package that will be used for the construction of a 153-unit student housing and retail project along with an adjacent 308-stall parking garage in Tallahassee. Fully originated through a long-standing mortgage brokering relationship, Bayview funded the entire debt stack through its wholly owned subsidiaries Bayview PACE and Oceanview Life and Annuity Co.

In the Commercial Property-Assessed Clean Energy (C-PACE) industry, typical financing can hit headwinds through underwriting and in obtaining consent from senior mortgage holders. C-PACE helps unlock capital for property owners to make energy-efficient and renewable building upgrades, fund new construction, and provide rescue capital toward recovery from the pandemic.

“We are excited to have closed this major transaction that signals an important solution for the commercial real estate industry,” says senior vice president Anne Hill of Bayview PACE. “C-PACE offers unusual flexibility and beneficial terms for qualified improvements in energy, lighting, water systems, building envelopes, and other resiliency components. Packaged with construction financing, it’s an ideal solution. Our end-to-end financing capabilities leverage the expertise of our team and strength of our network to deliver a market-leading solution for commercial real estate projects of all kinds, from student, senior and multifamily housing to industrial, hospitality, retail, office, mixed-use, and more.”

The packaging of a $48 million Oceanview construction loan and $15.6 million in C-PACE financing from Bayview PACE made for less issues as the underwriting is managed under one umbrella with Oceanview as the consenting senior lender. Bayview PACE and Oceanview are positioned to structure more of these package loans for the growing demand in commercial real estate amid tightening debt markets, according to the firm.

“Originating this new-construction financing via two Bayview products demonstrates our depth and strength in execution, and we are already working on more such deals,” adds Marco Lainez of Bayview.

The student housing, Renegade Apartments, is a joint venture of Charles Street Development Co. and ACRES Realty Funding. Designed by Humphreys & Partners with Ruscilli Construction Co. as general contractor, the project is expected to be completed in summer 2024 with pre-leasing planned for fall 2023. Asset Living will manage leasing and property management.

C-PACE program legislation is currently enabled in 37 states and is growing in popularity among real estate owners and financial institutions looking to serve them, according to Bayview. “We believe there are increasing numbers of companies facing delays if not hitting ‘pause’ on their projects, and our loan-combination can help optimize the capital stack and get things back on track,” says Matthew Philip, the New York-based head of commercial Lending for Bayview.