Lone Star PACE, the leading administrator of C-PACE financing in Texas facilitated the closing of a $11 million Commercial Property Assessed Clean Energy (C-PACE) transaction for the redevelopment of the MCM Elegante Hotel, located at 2355 I-10 in Beaumont.
The project will transform the existing hotel into a 287-key, dual-branded Courtyard and Element Hotel by Marriott. The Courtyard portion will feature 135 rooms, while the Element Hotel will include 152 rooms designed for extended-stay guests.
The sponsor is leveraging C-PACE to fund a comprehensive suite of energy and water efficiency improvements, including high-efficiency building envelope and windows, enhanced HVAC systems, upgraded lighting fixtures, and improvements to domestic hot water systems and low-flow plumbing.
These measures are projected to reduce annual energy consumption by 29%, water usage by 39%, and natural gas usage by 30%, significantly lowering operating costs while improving long-term asset performance.
Robert Loeb, Assistant Vice President of Originations at Peachtree Group, said:
“C-PACE plays a critical role in helping owners close the gap on projects that otherwise would not pencil in today’s environment. We’re seeing more situations where strong assets are held back by capital constraints, not fundamentals. By offering a lower overall cost of capital option, C-PACE allows sponsors to move forward with renovations that might otherwise be delayed or shelved.”
Commercial Property Assessed Clean Energy (C-PACE) is an innovative financing mechanism that enables property owners to fund energy efficiency, water conservation and renewable energy improvements through a voluntary property assessment. The program provides long-term, fixed-rate, non-recourse financing that can enhance project economics, improve cash flow and increase asset value.
Lee McCormick, President of Lone Star PACE, said: “C-PACE continues to play a critical role in repositioning and revitalizing hospitality assets across Texas. By incorporating long-term, low-cost financing into the capital stack, developers can meaningfully reduce their weighted average cost of capital while investing in high-performance building systems that drive operational savings and long-term value.”
This transaction highlights the growing role of C-PACE in adaptive reuse and major renovation projects, enabling owners to integrate efficiency upgrades that enhance both asset performance and long-term sustainability. MCM Elegante will remain open during the renovation, which is expected to take approximately 18 months to complete.