CPACE financing lets developers layer debt on top of senior loans to reach 85% leverage instead of the typical 65%, cutting equity requirements from 35% to 15%. More of your project gets financed at around 7% interest, lowering your total cost of capital.
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If you're a commercial real estate developer, here's a loan product that you could use to minimize your cost of capital and reduce the amount of equity that you need to bring to a deal. It's called cpace financing. Cpace. And what that does is it sits on top of your senior debt and it allows you to get up to a higher leverage, let's say maybe 85% leverage. So you only need to bring in 15% equity in the deal and then the rest is leveraged through your senior debt and your CPACE financing. So that way you could potentially have 85% of your deal be only around a 7% interest rate. Instead of having 65% of your deal being around a 7% interest rate on the remaining 35%. Give up a big portion of the equity to your investors who are investing in the deal. So look up cpace financing. It's a newer product, not a lot of people know about it, but it's an awesome strategy to maximize your leverage and minimize your cost of capital for your real estate development projects.