DC PACE Application Process Overview
Thank you for your interest in the Washington DC PACE Commercial Finance Program. Presented here is
a brief overview of the DC PACE application process and the specific steps involved in completing both a
financial and technical underwriting of your project. Urban Ingenuity is the program administrator of DC
PACE Commercial, working on behalf of the District Department of Energy & Environment (DOEE.)
We are ready to support your application, by connecting you with development partners,
assisting in the collection of project data and application materials, and working with you to take
your clean energy retrofit from application through project execution.
Key steps in applying for DC PACE
Commercial Financing
1. DC PACE Initial application
2. Project Definition
3. DC PACE Underwriting Process
4. Lender Consent
5. Capital Provider Selection
6. Approval and Closing
7. Project Execution
1.
DC PACE Initial Application: Complete the DC PACE application at [www.dcpace.com]
2.
Project Definition: Select either a DC PACE registered contractor or work with your preferred vendor
to develop a qualifying project; including project scope, costs, or detailed energy model sufficient to
meet PACE Program requirements. DC PACE will provide guidance on program requirements.
3.
DC PACE Underwriting Process: As a part of the review of your application, DC PACE will conduct
two parallel underwriting processes to reach closing. These include, Project Technical Validation,
which will verify modeled energy savings and assure that project benefits exceed project costs. In
addition, we will conduct a parallel process, Financial Underwriting, which will validate the financial
strength of the property and allow DC PACE to solicit financing term sheets directly from private
capital providers who will fund this project. Both of these processes will begin immediately, as we
work with you to assemble supporting documentation on your clean energy project scope, capital
costs, and property financials.
Project Technical Validation: The independent engineer for the DC PACE Commercial Program,
Clean Energy Solutions, Inc. (CESI) will serve as the third-party validator for all energy modeling
produced for this project. CESI’s role is to review and confirm the eligibility of planned project
measures, the reasonableness of modeled lifetime savings, and the sufficiency of ongoing
measurement & verification measures. To conduct the project technical validation DC PACE will
require completion of four pieces of documentation.
dcpace.com
i.
ii.
iii.
iv.
DC PACE Energy Audit Worksheet
Energy Audit Supporting Documentation – including any modeling
Utility Bills – covering at least 12 months (24 months preferred)
M&V Plan – The plan should cover a minimum of two years, can be flexible
Completion of the technical underwriting portion of the DC PACE application traditionally rests
with the contractor or owners agent managing the project, and generally requires only minimal
engagement of the property owner. DC PACE Commercial can set up a phone call with your
Contractor to go over any questions related to these requirements and underwriting standards
as appropriate.
Financial Underwriting: Urban Ingenuity manages financial underwriting to DC PACE standards.
This process principally focuses on the review of Loan to Value and Debt Service Coverage Ratios
for the property. In addition, we facilitate final project-level diligence and collection of
supporting documentation for our external capital providers. Once a financial prescreen has
been completed, DC PACE works with a range of financial institutions to solicit binding term
sheet offers, specific to the project. Finally, DC PACE works with owners to secure express
“lender consent” from any banks holding outstanding mortgage liens on the property.
To conduct the Financial Underwriting diligence, DC PACE will require collection of four
additional pieces of documentation. These are:
i.
ii.
iii.
iv.
Two years audited financials – (if available) plus current year-to-date actuals.
Current (and post-rehab) operating pro-formas – including projected cap-ex
reserves
Most Recent Appraisal or Value Statement
List of current tenants and lease term or other information supporting property
revenue.
4.
Lender Consent: Also as early as possible, we want to initiate discussions with both the current
first trust lenders in order to obtain consent to the placement of the PACE assessment on the
property title. There is a proven track record for securing lender consent nationally.
5.
Capital Provider Selection: DC PACE will conduct initial financial underwriting, and then reach out
to solicit term sheets from our pool of capital providers. DC PACE will then assemble the resulting
financial options for presentation to the owner, who will select the best offering based on terms
and rates that meet their priorities. DC PACE will then work with the capital provider and owner to
develop a final term sheet that is satisfactory to all parties.
6.
Approval and Closing: Once we have completed technical validation, secured lender consent, and
finalized the term sheet, DC PACE Commercial works in coordination with the property owner,
capital provider, and the District of Columbia, to prepare final closing documents, and complete
the financial closing and transfer of funds.
7.
Project Execution: After settlement on the PACE assessment, the borrower may proceed with
draw requests and project construction. Implementation of the project should meet any
commitments made for test-in and test-out validation of conservation measures and in support of
future measurement and verification.
202.681.5760
info@urbaningenuity.com
dcpace.com