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Green Loans and C-PACE Financing in Commercial Real Estate: Loan Structures, Principles, Guidelines

Alternative Financing to Meet Increasing Sustainability Standards for New Construction and Renovation Projects

Recording of a 90-minute premium CLE video webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
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Conducted on Tuesday, April 9, 2024

Recorded event now available

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This CLE webinar will explore the recent growth and trends in green lending in commercial real estate and how commercial property owners are using this alternative form of financing in today's challenging market to meet increased sustainability standards. The panel will discuss commercial property assessed clean energy (C-PACE) financing structures and other types of green loans available for both new and existing structures and provide an overview of the market principles and guidelines that allow a loan or project to be categorized as "green."


To address concerns about climate change and the effect that lending and investment decisions may have on the environment, commercial real estate lenders and investors are seeking ways to not only face the oncoming challenges and perils of climate change but also to satisfy new (though increasingly common) legislation demanding that commercial property owners reduce the environmental footprint of their buildings. Green loans and C-PACE financing are part of a critical strategy to address sustainability demands while also meeting an owner's investment objectives and financial returns.

A green loan is defined as any type of loan instrument made available exclusively to finance or refinance, in whole or in part, new and/or existing eligible green projects. This includes term loans, revolving credit facilities, and working capital facilities. To establish guidelines to ensure consistency across the wholesale green loan market, the Loan Market Association (LMA), together with the Asia Pacific Loan Market Association (APLMA) and the Loan Syndications and Trading Association (LSTA), published the Green Loan Principles (GLP) and Guidance on GLP. The GLP establishes a framework of market standards and voluntary recommended guidelines for a loan to be categorized as "green."

C-PACE financing generally provides upfront funding for clean energy projects for building property owners in the commercial, multifamily, and nonprofit sectors. To date, 40 states including the District of Columbia have adopted some form of C-PACE financing legislation. These programs use property liens to allow consumers to repay the funding on their property taxes over the long term, and they permit transferability of the assessment upon sale of the property.

C-PACE financing may be administered by state governments, local governments, or third-party administrators and can be layered in with other forms of financing, such as mortgage loan financing and historic tax credits. C-PACE debt typically cannot be accelerated and does not affect a lender's foreclosure rights and remedies.

Listen as our authoritative panel discusses the evolving landscape of green lending and C-PACE financing in commercial real estate. The panel will examine the various types of loans available and the underlying principles and guidelines required for these loan products and programs.



  1. Overview: trends in local legislation requiring decarbonization and sustainability measures for commercial buildings
  2. Green loans
    1. Definition
    2. Role green loans play in today's real estate financing market
    3. LMA, APLMA, and LSTA's GLP and Guidance
    4. Four components of a green loan: use of proceeds, process for project evaluation and selection, management of proceeds, and reporting
  3. C-PACE financing
    1. Uses for C-PACE financing
    2. How C-PACE financing is secured
    3. Advantages
    4. Layered with other forms of financing
  4. Other forms of green financing available for new construction and renovation projects to meet new building standards and requirements by local and state governments
  5. Key takeaways


The panel will review these and other relevant considerations:

  • What are green loans?
  • What are the LMA, APLMA, and LSTA's GLP and guidelines?
  • What is the typical C-PACE program structure and what are the benefits of this type of financing?
  • What types of projects are generally eligible for green loans and C-PACE financing?


Johnson, Abby
Abby Johnson

President and CEO
Virginia PACE Authority

Ms. Johnson is Executive Director and founder of the Virginia PACE Authority (VPA) and President of Abacus Property...  |  Read More

O’Malley, Carrie
Carrie Hallberg O'Malley

Partner, Chair Commercial Real Estate Finance and Investment Practice Group
Hirschler Fleischer

Ms. O’Malley leads the firm’s multidisciplinary commercial PACE (C-PACE) team, which to date, claims...  |  Read More

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