Renovate America Issues First-Ever Green Bonds Securitizing Property Assessed Clean Energy Bonds
Fifth Securitization of PACE Bonds Totals $202 Million
Fifth Securitization of PACE Bonds Totals $202 Million
SAN DIEGO, Nov. 25, 2015 /PRNewswire/ -- Renovate America, the leading provider of residential Property Assessed Clean Energy (PACE) financing in the U.S., announced the nation's first-ever "green bonds" securitizing PACE bonds. This is Renovate America's fifth securitization of PACE bonds in the U.S., issuing $201,532,000 in Class A Notes rated AA (sf) by Kroll and AA (sf) by DBRS, and represents 8,939 home improvements made that reduce energy or water consumption or produce renewable energy. Renovate America completed four prior securitizations of PACE Bonds between March 2014 and July 2015.
"Investors are looking for sustainable choices and now take environmental, social, and governance (ESG) factors into just as much account as shareholder returns," said Renovate America CEO J.P. McNeill, whose company represents more than 90 percent of the residential PACE market nationwide. "We have worked over the last three years to establish a proven asset class with PACE bonds. Now, we can also clearly demonstrate to investors the positive social and environmental impact of PACE improvements and their capacity to create clean energy jobs in local communities."
Sustainalytics, a leading global provider of ESG and corporate governance ratings and research, analyzed the offering's adherence to green bond principles. The firm verified that the selection process for Renovate America's projects and products is robust, and investments in them will help to create more energy efficient homes.
"U.S. consumers are showing greater interest in owning more environmentally friendly homes given the potential energy-related cost savings," said Sustainalytics' Global Director of Advisory Services, Simon MacMahon. "Renovate America's green bonds enable investors to help finance home efficiency projects, meeting this growing consumer demand and supporting the transition to low-carbon communities. We enjoyed working with Renovate America to verify the green status of the bonds and applaud their efforts to help consumers become more sustainable homeowners."
Renovate America partners with local governments to provide its version of PACE, the HERO Program (Home Energy Renovation Opportunity), to homeowners who finance a wide variety of product installations to conserve water and energy. These installations include energy-efficient products like HVAC, windows, and roofing; renewable and alternative products like solar; and water efficiency products for indoor systems and outdoor landscaping. HERO is unique in that it provides 100% financing for energy and water savings products for up to 20 years with fixed interest rates designed to make payments affordable. Homeowners make payments along with their property taxes, and in the event the property is sold, the remaining balance may be able transfer to the new owner.
Since 2011, the HERO Program has financed more than $1 billion in home improvements which will save more than $1.9 billion on energy bills, conserve 6.7 billion kWh of electricity, reduce emissions by 1.8 million tons or the of equivalent taking 347,000 SUVs off the road for a year, and save more than 2.1 billion gallons of water or the equivalent of 68 million showers. It has already created more than 8,400 jobs and had a local economic impact of more than $1.7 billion.
"Morgan Stanley is pleased to underwrite the inaugural green bond transaction for Renovate America," said Ricardo Rodriguez, an Executive Director at Morgan Stanley. "The success of the HERO program is evidence that public and private constituents can agree on scalable and sensible solutions while reducing our carbon footprint."
HERO is the largest and most successful residential PACE Program in the United States. More than 350 cities and counties have adopted the program across California, including the cities of Los Angeles, San Francisco, San Diego, San Jose, Fresno, Riverside, Anaheim, Santa Ana, Bakersfield, and San Bernardino, among others.
About Renovate America
Renovate America is the fastest-growing provider of financing for energy and water efficiency home improvements in the U.S. The company's HERO Program provides local governments with a comprehensive residential PACE financing solution that also includes consumer protection, business automation software, workforce training and ongoing access to private capital. This unique public-private partnership offers consumers access to more than 50 categories of products that reduce energy and water consumption. Public recognition of HERO includes the Governor's Environmental and Economic Leadership Award in California, the Urban Land Institute Best of the Best, and the Southern California Association of Governments President's Award for Excellence. Additional information can be found at www.renovateamerica.com and www.heroprogram.com.
Logo - http://photos.prnewswire.com/prnh/20150729/249205LOGO
SOURCE Renovate America
Share this article