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C-PACE Financing for Senior Housing | Haven Senior Investments
Capital Solutions · Alternative Finance

C-PACE Financing
for Senior Housing
& Assisted Living

Commercial Property Assessed Clean Energy (C-PACE) financing provides long-term, fixed-rate, non-recourse capital for energy efficiency, resiliency, and sustainability improvements at senior housing communities — repaid as a property tax assessment rather than a traditional loan. Senior housing is among the strongest fits for C-PACE in the entire commercial real estate landscape.

Talk to a Haven Advisor All Capital Solutions
30 yr
Max amortization
fixed rate
100%
Eligible improvement
costs covered
Non-recourse
No personal
guarantees
Transferable
Passes to new
owner at sale
What is C-PACE?
Commercial Property Assessed Clean Energy
C-PACE is a public-private financing mechanism enabled by state law that provides fixed-rate, long-term capital for energy efficiency, renewable energy, water conservation, and resiliency improvements to commercial properties — including senior housing. Repayment is structured as a special assessment on the property's regular tax bill, not as a conventional loan.
Repayment mechanismProperty tax assessment
RecourseNon-recourse to owner
Rate typeFixed — over 10-yr Treasury
Max termUp to 30 years
Personal guaranteeNot required
PrepaymentNo lockout; step-down premium
Senior lender consentRequired — not subordination
Transfer on saleAutomatic — no fees
How C-PACE Works

A Tax Assessment,
Not a Traditional Loan

C-PACE is structured differently from every other form of real estate financing. Rather than creating a conventional mortgage lien, C-PACE creates a special assessment on the property — similar in legal structure to a property tax. This structural distinction is what gives C-PACE its unique combination of long terms, fixed rates, and non-recourse execution.

The C-PACE assessment is attached to the property, not the individual or business entity. When the property is sold, the assessment transfers automatically to the new owner — along with the energy savings and improvements it funded. No fees, no approvals, no payoff required at sale.

C-PACE is enabled by state legislation and administered locally through public-private partnerships between state or municipal governments and private C-PACE capital providers. Not every state has an active C-PACE program — and program specifics vary by state.

01
State enables C-PACE legislation
C-PACE is available only in states that have passed enabling legislation. Local municipalities then opt in to create a local program within their jurisdiction.
02
Property owner identifies eligible improvements
An energy report or technical assessment identifies which project costs qualify as eligible C-PACE measures — HVAC, building envelope, renewable energy, water conservation, resiliency, and more.
03
Senior lender provides consent
Existing mortgage holders must consent to the C-PACE financing before closing. This is a consent — not a subordination or intercreditor agreement — confirming all parties understand the structure.
04
Assessment established and funds disbursed
The C-PACE assessment is established through the local program. For construction projects, funds are disbursed on a draw schedule — similar to a construction loan. For retrofits, funds are typically disbursed at closing.
05
Repayment via property tax bill
Annual or semi-annual C-PACE payments are made through the property tax bill — not directly to a lender. Payments may be structured with an initial interest-only or deferred period for new construction projects.
How C-PACE Fits the Capital Stack
10–20%
Equity
C-PACE reduces required equity by replacing expensive preferred equity or mezzanine debt — improving IRR and reducing capital at risk. Equity contribution is smaller with C-PACE in the stack.
20–30%
C-PACE Assessment
Fills the gap between senior debt and equity — replacing mezzanine debt or preferred equity at significantly lower cost. Fixed rate, non-recourse, long-term. Up to ~30% of property value in most programs.
50–60%
Senior Debt (Construction Loan / Mortgage)
Senior lender maintains first mortgage position. C-PACE is not subordinate to the mortgage — it is structured as a tax assessment with its own lien priority. Senior lender consent protects the mortgage lender's position.
Illustrative structure — actual percentages vary by project, state program, and lender requirements. C-PACE replaces the most expensive layer of the capital stack.
Why Senior Housing Is a Strong Fit

Long-Term Assets, Long-Term
Capital. Perfect Alignment.

C-PACE's structure — fixed rate, long amortization, non-recourse, attached to the property — aligns exceptionally well with the economics of senior housing ownership. Assisted living and memory care facilities are long-term operating assets where energy savings compound over decades and capital improvements directly strengthen both operations and asset value.

For assisted living and memory care specifically, the operational case for C-PACE is even stronger than for standard commercial real estate. Resiliency investments — backup generators, HVAC redundancy, building envelope — are operationally critical for licensed care facilities. When annual energy savings exceed the annual C-PACE assessment payment, the financing is net cash flow positive from day one.

Long hold periods match long amortization
Senior housing investors typically hold assets for 7–20+ years — aligning naturally with C-PACE's 20–30 year terms. The full energy savings benefit is realized over the hold period.
Energy savings can exceed annual payments
With 20–30 year amortization, annual C-PACE payments are sized to be exceeded by annual energy cost reductions — creating immediate positive cash flow from the financing.
Resiliency is operationally essential
Licensed care facilities require reliable HVAC, backup power generation, and building systems for resident safety and regulatory compliance. C-PACE funds these investments at long-term fixed rates.
Improves NOI and asset value
Lower utility expenses improve NOI directly. Energy-efficient, resilient buildings command higher valuations, lower cap rates, and stronger buyer interest at disposition.
Preserves working capital
100% upfront financing with no out-of-pocket cost for eligible improvements — preserving operating capital for staffing, census growth, and community programming.
Assessment passes to buyer at sale
When a C-PACE-financed community is sold, the assessment transfers automatically — with the energy savings and improved building. No payoff required, no refinancing delay.
Eligible Improvements for Senior Housing
HVAC SystemsHigh-efficiency heating, cooling, and ventilation — critical for resident comfort, code compliance, and energy cost reduction
Building EnvelopeInsulation, windows, doors, and exterior wall upgrades reducing heating and cooling loads
Standby GeneratorsEmergency backup power systems — especially relevant for licensed care facilities where power continuity is a regulatory requirement
LED LightingCommon area, corridor, and resident room lighting upgrades — significant energy cost reduction in 24/7 care environments
Roof ReplacementEngineered roofing with improved insulation and drainage — eligible when tied to energy performance improvements
Renewable EnergyRooftop solar, battery storage, and other renewable energy systems reducing utility dependency and costs
Water ConservationLow-flow fixtures, irrigation systems, water recycling — reducing utility costs in large residential care facilities
Boilers & ChillersHigh-efficiency central heating and cooling plant replacement — major capital investment eligible for long-term C-PACE financing
Seismic RetrofitsStructural improvements for seismic resiliency in applicable markets — eligible in many state programs
Code Compliance WorkImprovements required for regulatory compliance — carbon reduction mandates and resiliency requirements — eligible when tied to energy measures
Three Ways to Use C-PACE

New Construction, Retrofit,
or Retroactive Recapitalization

New Construction
Ground-Up Development
C-PACE can fund eligible portions of a new senior housing construction project — typically covering 30–35% of total project costs by financing the energy-related components of the construction budget. Funds are disbursed on a draw schedule alongside the construction loan, with no payments required during the construction period.
C-PACE reduces the construction loan size, replaces expensive mezzanine debt, and preserves equity — improving overall deal economics and IRR for the development. Note: C-PACE does not remain in the capital stack if Fannie Mae or Freddie Mac is the intended permanent loan takeout.
Retrofit / Renovation
Existing Community Upgrades
For existing senior housing communities undertaking energy efficiency, resiliency, or major mechanical upgrades, C-PACE can cover 50–100% of eligible retrofit costs. This is the most common C-PACE use case — owners who need major capital improvements but want to preserve cash and avoid a high-cost bridge or mezzanine loan to fund them.
Funds are typically disbursed at closing or in draws as improvements are completed. Senior lender consent is required before funding. The existing mortgage remains in first position throughout.
Retroactive Recapitalization
Improvements Already Completed
In most states, C-PACE can be applied retroactively to eligible improvements completed within the past 1–3 years — allowing senior housing owners who have already made qualifying capital improvements to extract liquidity, reduce their cost of capital, and recapitalize the completed work at long-term fixed rates.
Retroactive C-PACE is a valuable tool for owners who funded recent HVAC, roofing, or generator improvements with higher-cost capital and want to refinance into a more efficient structure without a full property refinance.
Full Term Reference

C-PACE Financing
Key Terms

Structure & Repayment
StructureSpecial property tax assessment — not a mortgage
Maximum termUp to 30 years (state-dependent; some limit to 25)
AmortizationFully self-amortizing — no balloon
Rate typeFixed for life of assessment — over 10-yr Treasury
RepaymentAnnual or semi-annual property tax bill
New construction paymentsNone during construction; deferred start available
PrepaymentNo lockout; no defeasance; step-down premium
RecourseNon-recourse — no personal guarantee required
Transfer at saleAutomatic — no approval, no fees
Retroactive eligibility1–3 years in most states
Sizing & Eligibility
Maximum C-PACE amountUp to ~30% of property value (state-dependent)
New construction coverageTypically 30–35% of total project cost
Retrofit coverage50–100% of eligible improvement costs
Minimum project sizeTypically $1M+ (varies by lender)
Property typesCommercial only — no single-family residential
Senior housing typesAL, MC, IL, SNF, CCRC — all eligible
Senior lender consentRequired prior to closing — not subordination
Geographic availabilityMost U.S. states — see program availability
Agency takeout (Fannie/Freddie)C-PACE does not remain in Fannie/Freddie refi
Technical assessment requiredEnergy report from qualified professional
Senior Lender Consent

The Most Misunderstood
Aspect of C-PACE

The requirement that existing mortgage holders consent to C-PACE financing is the most common source of confusion and hesitation among senior housing borrowers and their lenders. Understanding the difference between C-PACE consent and subordination is essential for successfully incorporating C-PACE into a senior housing capital stack.

Senior lender consent is not the same as subordination. The mortgage lender does not subordinate its lien position to C-PACE. The C-PACE assessment creates a separate lien with a different legal structure — a tax lien rather than a mortgage lien. The mortgage lender's foreclosure rights are fully preserved.

C-PACE assessments are non-accelerating — meaning only the current installment is due at any given time, not the full remaining balance. In the event of default, only the past-due installments (typically 1–3% of property value) hold assessment priority — not the entire C-PACE balance. This distinction gives most senior lenders comfort with the structure.

Growing Lender Acceptance
C-PACE is now active in the majority of U.S. states and has been used in institutional senior housing transactions nationwide. Many senior lenders — including banks, life companies, and SBA lenders — have consented to multiple C-PACE transactions and treat it as a standard component of modern construction and renovation finance. The growing track record has significantly increased lender comfort over the past five years.
Key Distinctions — C-PACE vs. Mortgage
Not a mortgage — a tax assessment
C-PACE creates a special assessment lien — the same legal structure as a property tax. The senior mortgage lender's mortgage lien remains in first position. There is no intercreditor agreement or subordination agreement required.
Non-accelerating — only past due amounts are senior
Only the overdue C-PACE installments — typically 1–3% of property value — hold assessment priority over the mortgage in a default scenario. The full C-PACE balance does not become senior to the mortgage upon default.
Foreclosure rights fully preserved
C-PACE does not restrict a senior lender's ability to foreclose on the property. The C-PACE assessment transfers with the property in foreclosure — it does not prevent or delay the senior lender's remedies.
Improvements strengthen collateral
Energy improvements funded by C-PACE increase building value, reduce operating costs, and improve NOI — strengthening the senior lender's collateral rather than diminishing it. Many senior lenders view C-PACE improvements as a positive underwriting factor.
Consent timeline — 30 to 60 days
The C-PACE process — from energy report to funding — typically takes 30–60 days once third-party reports are received, aligning with the senior lender's own appraisal and environmental report timeline. Adding C-PACE generally does not delay closing of the senior loan.
Important — Agency Takeout C-PACE does not remain in the capital stack when Fannie Mae or Freddie Mac is the intended permanent loan takeout. If a senior housing development project plans to refinance into a Fannie Mae or Freddie Mac seniors housing permanent loan after construction stabilization, the C-PACE assessment must be paid off at or before that refinancing. C-PACE is well-suited as a construction period financing tool in these situations — reducing construction loan size and equity requirements — but does not carry through to agency execution. Confirm this with your C-PACE lender and your intended permanent lender before structuring the capital stack.
Program Availability

C-PACE Is Available in
Most U.S. States

C-PACE financing requires state-enabling legislation and local municipal opt-in. The program has expanded significantly over the past decade — it is now active in the majority of U.S. states, covering the largest senior housing markets including Texas, California, Florida, New York, Ohio, and Colorado.

State-specific rules vary on eligible improvement categories, maximum term, maximum loan-to-value, and retroactive lookback periods. Haven works with C-PACE capital providers operating nationally to confirm program availability and specifics for your property's location before recommending C-PACE as part of a capital strategy.

Haven confirms C-PACE availability for your property before any recommendation. Program availability and terms change as states pass new legislation and municipalities opt in. Always verify current program status with a C-PACE capital provider before proceeding.
States Without Active C-PACE Programs
Idaho Wyoming Arizona Kansas South Dakota North Dakota Alaska
This list reflects program status as of early 2026. State C-PACE programs are added regularly as states pass enabling legislation. Some states have enabling legislation but limited active programs — confirm specific municipal availability with a C-PACE provider. This list is informational only and subject to change.
Haven Capital Solutions

Haven Helps Senior Housing
Owners Access C-PACE

Haven Senior Investments is a capital broker — not a C-PACE lender. Our role is to evaluate whether C-PACE is a viable and valuable component of your senior housing project's capital stack, and to introduce you to experienced C-PACE capital providers with senior housing transaction experience.

C-PACE works best when introduced early in the project planning process — before the capital stack is finalized and before the construction loan or mortgage is closed. Haven identifies C-PACE opportunities as part of a broader capital strategy, not as an afterthought.

C-PACE eligibility and sizing assessment
Haven evaluates whether your project qualifies, estimates the potential C-PACE financing amount, and identifies which improvements are likely eligible under your state's program
C-PACE capital provider introductions
Direct introductions to national and regional C-PACE capital providers with senior housing transaction experience — active lenders who know how to structure deals for care facilities
Capital stack optimization
Haven evaluates how C-PACE integrates with your senior debt, construction loan, equity, and intended permanent financing — including any agency takeout implications for Fannie or Freddie refinancing
Senior lender coordination
Haven helps facilitate the senior lender consent conversation — providing lenders with the information and precedent needed to evaluate C-PACE participation efficiently
C-PACE Financing Inquiry
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