A lot can change in ten years. Just ask Nuveen Green Capital Founders Jessica Bailey and Alexandra Cooley.
When the two met while developing Connecticut’s C-PACE program, C-PACE (Commercial Property Assessed Clean Energy) financing was still in its infancy. A decade later, not only has C-PACE availability expanded from three to forty states with the help of Bailey and Cooley’s leadership, but their firm has grown from a small startup based in the Nutmeg State to a national powerhouse with over $3.5 billion dollars in originations. We spoke with Bailey and Cooley about their journey so far and where they see C-PACE going in the next ten years.
The Early Days
When C-PACE was first rolled out in California, Ohio and Connecticut, it was conceived fairly narrowly. At first, its use was limited to making solar improvements on existing buildings.
However, Bailey and Cooley saw the program’s potential early on.
“We could see demand on the borrower side and the investor side,” recalls Cooley. “We were confident the asset class was going to perform well.”
The pair founded Greenworks Lending to serve the budding C-PACE market in 2015, and quickly set about building a team of experts who could help expand the program into more territories.
“C-PACE depends upon pulling together many stakeholders, starting with state policy and programs,” explains Bailey. “It also depends upon rating agencies understanding how this works, commercial real estate owners understanding how it works, and investors understanding how it works.”
Greenworks, which became Nuveen Green Capital in 2021 after being acquired by Nuveen, an asset manager with more than $1 trillion of AUM, was at the forefront of C-PACE legislation across the country. “We invested heavily in a specialized, in-house policy team early on,” says Bailey, who described how Nuveen Green Capital worked closely with policymakers and industry groups to standardize the programs from state to state as much as possible.
Those efforts are paying off. New data from the C-PACE Alliance shows that the C-PACE industry grew from a $211 million industry in 2015 to nearly $10 billion by the end of 2024. Nuveen Green Capital has grown along with it, providing almost 50% of the total C-PACE originations volume in 2024.
Changing the Game
Bailey and Cooley have been at the forefront of expanding not only C-PACE’s geographic footprint, but also how the funding can be used.
“We’ve seen the market for C-PACE grow pretty significantly over the last ten years,” says Bailey.
What began as a program aimed at environmental retrofitting of equipment like solar panels and boilers has expanded to include other use-cases. While those standard retrofits still make up about 10% of Nuveen Green Capital’s business, new construction funding has become a majority of the company’s business, with C-PACE financing representing an increasingly large slice of many capital stacks.
For example, the firm recently provided $40 million in C-PACE capital to finance pre-development costs for Naftali Group’s JEM Private Residences, a planned 65-story luxury residential tower that is part of a mixed-use new development project in Miami, Florida.
Nuveen Green Capital also pioneered another use for C-PACE, which has grown to represent nearly half of their business: recapitalization.
“Many states will allow for what’s called a ‘look-back period’ where you’re able to use C-PACE to refinance measures you’ve installed between 12 and 36 months after the completion of that project,” explains Bailey. “That’s proven to be a very important tool for the commercial real estate industry, because it gives them the ability and the optionality to access long-term, fixed-rate capital in a volatile market to reduce the rate and stabilize the asset with lower debt service by paying down expensive capital.”
NGC provided $220 million in C-PACE financing to recapitalize recent sustainability and resiliency measures for 200 Park in San Jose, California, a state-of-the-art, LEED Gold certified, class-A office building designed and developed by the Jay Paul Company, the second largest C-PACE financed transaction to date.
Continuing to Evolve
Bailey and Cooley have built a team of nearly a hundred people while maintaining a startup mentality.
“One of the secrets to our success has been the willingness to reinvent what we do as the market has shifted around us,” says Bailey. “C-PACE is a remarkably flexible tool that can meet the needs of both investors and building owners in various market cycles.”
The future looks bright, especially since C-PACE offers a solution to volatility and rising costs.
“We don’t see any signs of the C-PACE industry hitting its natural limit,” Bailey states. In addition to expanding their current business, the company has aspirations to grow internationally.
With more experience than any other C-PACE originator, Nuveen Green Capital is positioned to lead the industry into the future with Bailey and Cooley confidently at the helm.
“There’s still so much in front of us—new markets, more expansion, the potential to continue to support the commercial real estate space with C-PACE and other products,” says Cooley. “It’s an exciting time for us and for the industry.”
To learn more about the benefits of C-PACE financing, visit nuveen.com/greencapital.