Monthly Archives: March 2013

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FOR IMMEDIATE RELEASE

CONTACT: Ryan Ahearn, Figtree Financing
rahearn@figtreefinancing.com
Mobile: (858) 771-0896

 Milestone Figtree Successes in Obtaining Mortgage Lender Consent Free Commercial Property Owners to Use PACE Financing Tool with Confidence

(San Diego, CA:  March 28, 2013) – Commercial PACE financing is alive and well in California, despite last week’s surprise 9th Circuit Court of Appeals ruling agreeing that the Federal Housing Finance Agency (FHFA) was within its rights as a ‘conservator’ of mortgages held by Fannie Mae and Freddie Mac when it issued a ruling against PACE, effectively putting the brakes on residential PACE financing for homeowners across the U.S., according to a statement released by Commercial PACE provider Figtree Energy Financing.

PACE (Property Assessed Clean Energy) financing is a unique funding mechanism that allows property owners to obtain 100% up-front financing for money-saving renewable energy, energy efficiency or water conservation improvements and to repay that financing over periods of up to 20 years via voluntary assessments on property tax bills.  If a property is sold, the financing obligation transfers to the new owner.

“We share the disappointment of the contractors, property owners, municipal officials and environmental advocates working so hard to employ residential PACE.  We as a commercial PACE provider see the enthusiasm for residential PACE and are constantly being asked when we are going to be in the market offering this valuable job-creating program,” said Figtree PACE CEO Mahesh Shah.  Over the past twelve months, nearly 50,000 individuals have voiced their opposition to the FHFA’s ruling against residential PACE as part of  the ruling’s litigation process.

The Bond Buyer

by: Keeley Webster
Monday, March 25, 2013

A federal appeals court ruling struck a blow to a financing program for energy efficiency and water conservation projects on homes when it upheld a decision last week by the FHFA prohibiting participation by Fannie Mae and Freddie Mac.

Property Assessed Clean Energy (PACE) allows residential and commercial property owners to use municipal bonds to finance energy efficiency and water conservation projects. The costs are financed by bonds and repaid typically over a 15 to 20-year period by property owners in property tax assessments.

Sonoma and Riverside counties are continuing programs aimed at homeowners even though the lack of participation by Fannie and Freddie means homeowners would have to pay off the improvement expenses before selling their homes. Unaffected by the FHFA’s decision, commercial real estate PACE programs are taking off in California.

Originally conceived in Berkeley, Calif., in October 2008 as a way to help homeowners pay the upfront costs of installing energy efficient technologies, the PACE program stalled in July 2010 when the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, ordered the government-sponsored enterprises not to underwrite mortgages for homes with PACE loans. FHFA was concerned because the PACE liens are senior to the mortgage, so the PACE lender would be paid ahead of the bank, or Fannie or Freddie, in the case of foreclosure.

PACE liens are added to the property owner’s tax bill and stay with the property if it is sold.

Figtree CEO ‘fine-tuning’ solar financing, one city at a time

By JAMES PALEN, The Daily Transcript
Wednesday, March 20, 2013

With a heavy financial background, Mahesh Shah, chief executive officer for Figtree Energy Financing, is steering the company toward expansion.

Within the next couple of months, Figtree, a Mira Mesa-based facilitator of transactions using the financing mechanism of property assessed clean energy — PACE, will begin its part in carrying out the PACE program approved by the city of San Diego.

An increasingly popular financing option, PACE allows a commercial property owner to repay the costs of energy and water efficiency upgrades over a period of time through a voluntary assessment on property tax bills. The program can be administered to fund projects’ upfront costs through either the tax-assessing municipality’s treasury or an outside company’s privately raised capital.

Figtree provides an option for the latter of those two methods, and is today the only San Diego-based commercial PACE provider. The CEO of the company since it was formed less than two years ago, Shah signaled that he’s just getting started.

Growth of Commercial PACE in California

March 13, 2013
By Bill Roth

View Exclusive Interview on TriplePundit.com

Property Assessed Clean Energy (PACE) financing of clean technologies is making a comeback by targeting commercial properties. At the end of 2012, San Francisco became the first city to finance a project using commercial PACE. In conjunction with San Francisco’s milestone financing, 14 California counties and 126 cities have launched the nation’s largest commercial PACE program called CaliforniaFirst.

PACE is a financing program where cities or counties allow property owners to pay the financing cost for upgrading their building with clean technologies through property taxes. Qualified improvements covered by PACE include installation of efficiency lighting retrofits, energy/water saving systems and clean tech onsite generation including solar and fuel cells.

PACE was a hugely successful residential program before it was stopped in its tracks when the Federal Housing Financing Authority, along with the Office of the Controller Of The Currency, issued guidance that a PACE program was an involuntary subordination of a mortgage. This guidance effectively threatened the mortgages underwritten by the FHFA for homes that also had PACE financing.

Over 200 property owners, solar and energy efficiency contractors, lenders and municipal officials from across California traveled to the Los Angeles Biltmore Millennium Hotel for a two-day symposium March 13-14 sharing a variety of best program practices whose implementation could lay the groundwork  for a healthy PACE (Property Assessed Clean Energy) marketplace in California.

The symposium’s moderated discussions on program models, best practices, implementation – and results –  provided decision makers with the necessary tools to take advantage of PACE’s innovative approach to funding energy efficiency, renewable energy and water efficiency projects.

FIGTREE CEO Mahesh Shah joined the CEOs of Clean Fund and Ygrene Energy  – along with Nathalie Trojan, a Senior Director with PACE advocacy organization PACENow - to address the all-important  Mortgage Lender Relationship, something essential to preserve as property owners utilize PACE financing to improve their assets.  Like all property tax assessments, PACE assessments are viewed as having priority lien status over primary mortgages, which can adversely impact a property owner’s relationship with his/her mortgage lender if not properly finessed.