World’s largest green bond platform has now mobilized more than $2 billion in funds from global markets to invest in home energy and efficiency improvements
SAN DIEGO, April 28 – Renovate America, the nation’s leading provider of residential Property Assessed Clean Energy (PACE) financing, today announced the closing of its tenth securitization of PACE green bonds.
The securitization, HERO Funding 2017-1, included $232 million of class A1 and A2 notes rated AA (sf) by Kroll, AA (sf) by DBRS and AAA by Morningstar. It was the first PACE securitization to be rated by three different agencies, and the first HERO bond securitization to obtain a AAA rating.
With this securitization, Renovate America has now mobilized over $2 billion in funds from global capital markets to invest in energy and efficiency improvements that are benefiting local homeowners and their communities. The home improvements covered by the bonds in all 10 securitizations are projected to reduce utility bills by more than $3.5 billion over the useful lifetime of the products installed.
The projects backed by the bonds in the tenth securitization are expected to lower homeowners’ water and energy bills by more than $295 million. Projects covered by this securitization are also estimated to have created more than 1,600 jobs.
The notes are initially secured by PACE assessments levied on nearly 8,000 residential properties in 38 California counties as part of Renovate America’s HERO Program. The initial PACE assessments have an average balance of approximately $23,169.95, a weighted annual interest rate of 8.10 percent and a weighted-average original term of 17.7 years. The underlying bonds were originated between January 1 and March 31 of this year.
The HERO bond platform is the largest asset-backed securities platform to solely produce green bonds, with each of the company's ten 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.
HERO green bonds have received significant interest, in part, because they do not fund aspirational or speculative projects; the proceeds have already been invested in residential energy efficiency, renewable energy, and water efficiency projects whose environmental impact is verified.
About Renovate America
Renovate America offers a tech-enabled financing platform for home improvement and commercial retrofits that empowers communities to modernize and make their housing stock more efficient, while giving small businesses the tools they need to grow. In addition to financing home improvements through an unsecured lending product, Benji, Renovate America offers communities the HERO Program. HERO is the leading residential Property Assessed Clean Energy (PACE) program in the U.S. and has financed more than $2.3 billion of home improvements in partnership with local governments. It is estimated that HERO is on track to save nearly $3.7 billion in energy and water bills, and has created over 19,000 local jobs that cannot be offshored or automated. Renovate America has built the world’s largest 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.