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Dallas PACE Program Executes Largest Deal in Texas
Harwood International’s Swexan Hotel is receiving nearly $40 million in loans to make sustainable improvements as part of the City of Dallas’ Property Assessed Clean Energy (PACE) program. PACE is an innovative financing program that allows owners of commercial, industrial, and multi-family residential properties, with five or more dwelling units, to obtain low-cost, long-term loans for water conservation, energy-efficiency improvements, and renewable retrofits. Owners gain access to private, affordable, long-term, typically 10 to 20 years, financing that is not available through traditional funding avenues.
The Swexan is a 22-story boutique hotel being built at the corner of McKinnon and Moody streets, just west of the Crescent and the Tower Residences Ritz-Carlton condo building. It plans to use approximately $39,873,850 in PACE financing to make sustainable improvements to the building’s HVAC, plumbing, building envelope, glass curtain wall, and elevators, resulting in the savings of approximately 1.2 million kilowatt-hour of electricity and over 420,000 gallons of water annually.
The project is by far the largest PACE project ever financed in Texas. It’s made possible by Texas PACE Authority, the City of Dallas’ third-party administrator for the PACE financing program. Texas PACE Authority is a nonprofit organization that advances Property Assessed Clean Energy (PACE) projects in Texas by administering a uniform commercial and industrial PACE program on behalf of local governments.
The PACE lender, PACE Equity, collaborated with developer Harwood International on mid-construction funding which allowed the developer to avoid the need for additional equity to cover cost overruns for high efficiency energy and water savings equipment.
In 2016, Dallas was the first Texas city to implement a PACE program at no cost to taxpayers. The Dallas PACE program has facilitated a cumulative investment of more than $112 million in energy and water-saving improvements, approximately one-third of the total PACE investment in Texas. PACE projects also contribute to the goals of Dallas’ Comprehensive Environmental Climate Action Plan.
For more information, visit: City of Dallas PACE Financing Program and Texas PACE Authority.
Photo Credit: CSRS Inc.