Developers In Kansas City, Missouri, Invest In Two Downtown Buildings
According to the developers, the financing will be used for a series of energy efficiency upgrades and improvements to their properties, both of which are being redeveloped into mixed-used buildings in the heart of downtown Kansas City.
Redevelopment of the historic Brookfield Building in downtown Kansas City will transform a dilapidated downtown property into a modern, high efficiency mixed-use building, while restoring it to its historic grandeur.
The 85-year old building has stood vacant since 2005 as developers worked to raise capital for the project. The principals saw PACE as a perfect solution for financing high-efficiency new heating, ventilation and air-conditioning systems, new LED lighting and water heater improvements. The $2,420,000 in PACE financing is the largest commercial PACE transaction in Kansas City to date.
1721 Walnut Street is located in the Crossroads Art District and is a focal point of Kansas City's urban redevelopment. Linden Street Partners acquires, repositions and develops real estate assets in the western and central United States. Linden will utilize $625,000 in PACE financing for a new roof, insulation, and new windows as part of the redevelopment project that will turn a three-story warehouse into a modern, 38-unit apartment building with ground floor commercial space. The improvements are expected to reduce both buildings' energy consumption by about $550,000 annually.
Both projects are being financed by CleanFun, the largest national commercial PACE provider, offering long-term financing for energy efficiency, renewable energy, and water conservation specifically for commercial, industrial, multifamily and other non-residential properties across the U.S.
CleanFund has built strong relationships in Kansas City with property owners, project developers, and local financial institutions such as Equity Bank, Dougherty Funding, and US Bank CDC, to jointly support the downtown redevelopment of Kansas City with the tools to make renovation projects economically feasible, developers said.
PACE Sage of Overland Park, Kansas, a local PACE finance originator, brought the Brookfield project to CleanFund and assisted the developer in obtaining more than $400,000 of additional PACE funding than what was originally applied for. RAHILL Capital of St. Louis served as the PACE project consultant for the Walnut project.
"Owners are always looking for sources of funds to make their project happen or make their returns more attractive," said Anne Murphy Hill, Founder & President of RAHILL Capital.
Josh Smith, CleanFund's Senior Transaction Counsel said, "This transaction demonstrates that PACE can work in conjunction with a much larger capital stack, including traditional construction loans, tax equity funds, state and federal historic tax credits, and new market tax credits."
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