SAN DIEGO, Dec. 15 – Renovate America, the nation’s largest provider of residential Property Assessed Clean Energy (PACE) financing, announced the closing of its ninth securitization of PACE infrastructure bonds.
The securitization, HERO Funding 2016-4, includes $284 million of class A1 and A2 notes rated AA (sf) by Kroll and AA (sf) by DBRS. With the ninth securitization, Renovate America has now issued more than $1.9 billion worth of bonds – all of which have helped to improve residential infrastructure while creating local jobs that cannot be automated or moved offshore.
The notes in the latest deal are initially secured by 9,008 PACE assessments levied on residential properties in 36 California counties as part of Renovate America’s HERO Program. The initial PACE assessments have an average balance of approximately $22,722.51, a weighted annual interest rate of 7.99 percent and a weighted-average original term of 15.48 years. The initial PACE assessments were originated between Sept. 7, 2016, and Nov. 18, 2016.
Renovate America Head of Investor Relations Nicole Montecalvo noted that with the latest securitization, the company had more than doubled its investor base in 2016. "We are grateful to all of our existing and new investors across the globe who are making it possible for Americans to finance home improvements that enhance local infrastructure, create jobs and that conserve water, save energy, and reduce our carbon footprint," she said.
The projects backed by the bonds are expected to lower homeowners’ water and energy bills by more than $298 million over the useful lifetime of the products installed. Projects covered by this securitization also created more than 1,700 jobs. Across all nine securitizations, Renovate America projects have improved the residential infrastructure of more than 80,000 homes in hundreds of communities, creating more than 17,000 local jobs.
Renovate America has created the world’s first platform that solely produces green bonds, with each of the company's nine securitizations having been designated as green by Sustainalytics, an investment research firm specialized in environmental, social and governance (ESG) research and analysis. HERO bonds also adhere to the Green Bond Principles, a set of commonly agreed standards in the capital markets on what constitutes a green bond.
About Renovate America
Renovate America has built a tech-enabled market platform for home improvement and commercial retrofits, and partners with state and local governments to offer communities the HERO Program. HERO is the leading residential Property Assessed Clean Energy program in the U.S. and has financed $2 billion of home improvements. HERO is on track to save its customers more than $3 billion in energy and water bills, and has created nearly 17,000 clean-energy jobs. This unique public-private partnership offers consumers access to financing for more than 60 types of products that reduce energy and water consumption, without the need for government funding. The HERO Program has received a number of recognitions including a Climate Leadership Certificate for Innovative Partnerships by the U.S. Environmental Protection Agency, inclusion in the 2016 White House Water Summit, the Governor’s Environmental and Economic Leadership Award in California, and the Urban Land Institute Best of the Best. Renovate America has the world’s first green bond platform, with a volume of originations that enables securitization of HERO PACE bonds multiple times a year, attracting international investment to meet U.S. clean energy objectives.