Greenworks lending receives second S&P green evaluation for C-PACE assets
(Darien, CT) – Greenworks Lending, the largest Commercial Property Assessed Clean Energy (C-PACE) capital provider in the country, today announced that its securitization of C-PACE assets, PACEWell 3 LLC, has received a Global Ratings Green Evaluation from S&P. This is the second Green Evaluation for the company; the first was received in May of 2019 for its first securitization of C-PACE assets, PACEWell 2 LLC. S&P Global Ratings Green Evaluation provides a second party opinion on a company’s framework or issuance’s alignment with the Green Bond Principles.
The transaction achieved an overall score of 79 out of 100, which is equivalent to a Green Evaluation score of E1–the highest score on S&P’s scale of E1 to E4. PACEWell 2 LLC’s Green Evaluation in May of 2019 also received the highest score of E1.
PACEWell 3 LLC was scored on transparency, governance and mitigation. The overall Green Evaluation score of 79 was reached by weighing the mitigation score of 79 by 60%, the governance score of 78 by 25%, and the transparency score of 88 by 15%. The transparency score focuses on the quality of disclosure, reporting and management of bond proceeds. Governance assesses what steps have been taken to measure and manage the environmental impact of the proceeds of the financing, including certification, impact assessment, risk monitoring and risk management. The mitigation score reflects the environmental impact of the use of proceeds over the life of the assets.
“Reducing carbon emissions from the built environment and promoting sustainable real estate development is central to Greenworks’ mission. Our goal since 2015 has been to bring low-cost capital to property owners and developers in order to promote clean energy usage, and this recognition validates our company’s role in promoting a more sustainable future. The evaluation by S&P brings further transparency and legitimacy to the hard work we are doing to help mitigate climate change and helps to amplify our mission,”
Greenworks Lending helped open the market for the C-PACE asset class after it completed the industry’s first rated issuance in 2017. It was also the first C-PACE capital provider to complete a second rated securitization, which it completed in 2018.
“Nuveen has been a leader in ESG principles and Responsible Investing for many years and Greenworks’ tangible impact on the environment through its C-PACE platform is a major reason why we continue to increase our investment in the company through the PACEWell securitizations,” said Chris Miller, Senior Director at Nuveen, who led the note purchase of Greenworks’ C-PACE assets.
By allocating the full amount of the net proceeds of bonds to eligible green projects, using clear green criteria to select projects for funding, managing and tracking proceeds, and committing to regular reporting of environmental impact and use of proceeds, Greenworks has aligned this transaction with the Green Bond Principles (GBP) 2018, as outlined in S&P’s evaluation.