Petros PACE Finance has closed an $11 million C-PACE transaction with WestPac, a Santa Barbara-based investment, development and management firm, to finance seismic upgrades for the Hotel Cerro, a historic gut rehab project in downtown San Luis Obispo, California.
WestPac will use the funds for a seismic retrofit to an early 20th-century property as part its conversion into a five-story, 65-room boutique luxury hotel. The hotel will include the largest spa and the first rooftop pool and bar in downtown San Luis Obispo, along with dining and event spaces, a distillery, and rooftop garden. Located in the heart of the coastal city, the hotel will cater to visitors of the popular tourist destination, including wine country guests, parents of Cal Poly SLO students, wedding and business groups.
C-PACE is a relatively new financing tool for energy and water efficiency projects that has grown quickly in recent years. A low-cost, long-term financing product secured as a property tax assessment, it solves many problems that have historically prevented commercial building owners from investing in energy efficiency or renewable energy, such as high upfront costs. Additionally, California property owners can use C-PACE for seismic upgrades to more cost effectively reinforce their buildings.
Petros closed the transaction through the Western Riverside Council of Governments (WRCOG) PACE Program. Specialty Construction served as the general contractor for the project.
The hotel is expected to be open to guests by the end of the year.
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