C-PACE lets commercial owners pay for energy, water, and resiliency upgrades through a special assessment on the property tax bill. The DMV has three versions. DC PACE is one of the older programs in the country. Montgomery County’s MC-PACER runs under Maryland law. Virginia C-PACE covers most of Northern Virginia, while Arlington runs its own program. Each has its own administrator, caps, and paperwork. All three are private capital with a public collection mechanism. They all need your mortgage lender’s consent.
For how C-PACE works in general, start with C-PACE financing. DC program rules come from the Department of Energy and Environment’s DC PACE page and DC Green Bank. Montgomery County owners should read the county’s C-PACE page. Virginia owners should check the Virginia PACE Authority.
Call (833) 264-7776, or send the project through the C-PACE financing request.
Why C-PACE matters more in the DMV right now
DC BEPS. The District’s Building Energy Performance Standards require privately owned buildings of 10,000 sq ft and up to benchmark energy use. Larger buildings that fall below the performance standard for their type must complete a compliance pathway or face penalties. A 1960s apartment building in Ward 4 or an older office in NoMa can face a seven-figure retrofit. DC PACE is built for that problem. Detail: DC BEPS investor guide.
Montgomery County’s own standards. Montgomery County has a separate building energy performance law for larger buildings. Owners in Bethesda, Silver Spring, and Rockville face the same retrofit question under a different rulebook.
Aging building stock. The region has a deep inventory of 1950s–1980s garden apartments, low-rise offices, and strip retail. Boilers, chillers, roofs, and windows are near the end of their lives. C-PACE spreads that cost over 15 to 30 years.
The three programs side by side
| Feature | DC PACE | Montgomery County MC-PACER | Virginia C-PACE (and Arlington) |
|---|---|---|---|
| Administrator | DC Green Bank (since Oct. 2021) | Montgomery County Green Bank | Virginia PACE Authority; Arlington uses its own administrator |
| Legal base | District law, program under DOEE | Maryland 2014 enabling law; county Bill 6-15 as amended | Virginia Clean Energy Financing law; local ordinances |
| Typical term | Up to 20 years | Fully amortizing; term tied to measures | Tied to useful life |
| Leverage guidance | 2023 program targets: PACE up to 20% of value with a mortgage, 35% without; total LTV around 80% | Total debt including PACE no more than 90% of value | Per program guidelines |
| Tax history | Current on taxes | Current on property taxes for last 5 years | Current on taxes |
| Lender consent | Required | Required by Maryland statute | Required |
| Eligible property | Commercial, industrial, nonprofit, religious, 5+ unit multifamily | Commercial, industrial, multifamily | Commercial, industrial, 5+ unit multifamily |
Northern Virginia participants. The Virginia PACE Authority lists Fairfax County, Loudoun County, Prince William County, the City of Alexandria, the City of Fairfax, and Falls Church. Alexandria’s program also covers stormwater, resiliency, and EV charging. Arlington updated its own county program in November 2024 and runs it separately.
Other Maryland counties. Prince George’s and other counties have used the statewide MD-PACE program. Confirm current participation for your parcel before you design the project.
What DMV owners actually finance
| Property | Common C-PACE scope |
|---|---|
| Garden and mid-rise apartments (5+ units) | Central boiler or chiller replacement, in-unit heat pumps, windows, roof insulation, domestic hot water, LED, low-flow |
| Older office (NoMa, downtown, Rosslyn, Silver Spring) | Chiller and cooling tower, building automation, elevator efficiency upgrades, envelope, solar |
| Strip and neighborhood retail | Rooftop units, roof replacement with insulation, LED, solar |
| Industrial and flex (Prince George’s, Chantilly, Sterling) | Roof, LED high-bay, solar, dock seals |
| Nonprofit, school, and church buildings | Mechanical systems, windows, solar; eligible in DC even without a property tax bill |
| New construction | Above-code mechanical, envelope, and on-site renewable energy |
How C-PACE stacks with bridge, bank, and SBA debt
| Layer | Role | Who provides it |
|---|---|---|
| Acquisition or repositioning | Bridge at 8.99%–13.5% IO | Jaken Finance Group |
| Eligible retrofit | C-PACE assessment | Registered capital provider |
| Permanent senior | Bank, life company, or SBA 504/7(a) for owner-users | Lender or SBA partner |
| Equity | The remainder | Sponsor |
Consent first. The assessment has tax-like priority. Banks often consent at moderate PACE-to-value ratios. Agency multifamily lenders generally do not. Many DSCR lenders do not. If your exit is an agency refinance, C-PACE may need to be paid off at refinance. Model that before you record it.
Owner-users. A business buying its own building with SBA can sometimes pair C-PACE with the 504. It is often simpler to put eligible work inside the SBA project. Compare both. See SBA loans Washington DC.
Worked example — Ward 4 apartment building facing BEPS
Composite file. An owner holds a 64-unit, 58,000 sq ft apartment building near Brightwood. It is below the BEPS standard for its property type. The building is worth $11,000,000. It carries a $6,200,000 bank mortgage. The owner pays for heat and hot water.
| Line | Figure |
|---|---|
| C-PACE scope: boiler-to-heat-pump conversion, controls, windows, roof insulation, LED, low-flow | $1,400,000 |
| PACE-to-value | 12.7% (under the 20% target with a mortgage) |
| Total debt to value after PACE | 69.1% |
| Term and rate (illustrative) | 20 years at 7.5% |
| Annual PACE assessment | ~$137,300 |
| Existing mortgage debt service ($6.2M, 6%, 30 years) | ~$446,100 |
| Current NOI | $720,000 |
| Coverage including PACE | 1.23x |
| Projected annual utility savings | ~$74,000 |
| Coverage after savings | 1.36x |
Coverage clears the program’s 1.2x target before savings and improves after. The owner avoids a $1.4 million capital call. The building moves toward BEPS compliance. The bank consented because PACE-to-value stayed modest and the retrofit supports the building’s value.
Rent control note. Many DC buildings of this age are rent-controlled. Do not assume you can recover the assessment through rent. DC has specific petition processes for capital improvements. The deal must work on energy savings and compliance value.
Worked example 2 — Silver Spring retail center under MC-PACER
Composite. An owner of a 28,000 sq ft neighborhood retail center in Silver Spring plans a roof replacement, 180 kW of rooftop solar, and six rooftop HVAC units.
| Line | Figure |
|---|---|
| Property value | $3,800,000 |
| Existing mortgage | $2,600,000 |
| MC-PACER scope | $520,000 |
| Total debt to value | 82.1% (under the 90% county cap) |
| Annual assessment, 20 years at 7.25% (illustrative) | ~$50,000 |
| Recovery | Depends on leases; many NNN leases pass property taxes to tenants |
The lease question. Some retail leases let the landlord pass property taxes through to tenants. Whether a PACE assessment counts as a pass-through tax depends on the lease language. Tenants and their counsel often push back. Review every lease before assuming recovery.
The same project in Fairfax County would run through the Virginia PACE Authority. In Arlington it would run through the county’s own program. In DC it would run through DC Green Bank. The math is similar; the paperwork and the leverage caps are not.
Local risk — consent, caps, rent control, and exits
Refinance consent. A 20-year assessment will outlast your current mortgage. Every future lender must accept it. Keep PACE-to-value moderate so more lenders will say yes.
DC rent control. Capital improvement recovery on rent-controlled units requires a formal petition. Do not underwrite rent increases you cannot legally collect.
TOPA on sale. Selling a DC apartment building triggers TOPA rights for tenants. The assessment transfers with the property. Buyers and tenant associations will look at it. Disclose it early. See the DC TOPA and DOB compliance guide.
Jurisdiction mix-ups. A Takoma Park address may be in Maryland. A Falls Church mailing address may be in Fairfax County. Confirm the program by parcel and taxing jurisdiction, not by the post office name.
Condos and small buildings. Condos are hard fits. One-to-four unit rowhouses do not qualify anywhere. Those owners should look at DSCR loans Washington DC or hard money lenders Washington DC for rehab funding.
Tax sale exposure. A missed PACE payment is a missed tax payment. It can lead to tax-sale procedures. Escrow the assessment with your senior servicer if possible.
Checklist for a DMV C-PACE file
- Confirm the program by parcel: DC, Montgomery County, Virginia C-PACE locality, or Arlington
- Energy audit, BEPS status, or contractor bids for eligible measures
- Property taxes current (five years for Montgomery County)
- Mortgage lender consent requested before design is final
- Future refinance lender confirms it will accept a PACE assessment
- Coverage modeled with and without projected savings
- Lease review for tax pass-through (commercial) or rent-control limits (residential)
Related DC and DMV guides
- C-PACE financing (national overview)
- C-PACE financing Chicago
- DC BEPS investor guide
- Commercial lending Washington DC
- SBA loans Washington DC
- Bridge loans Washington DC
- DC property tax investor guide
Apply for C-PACE · Submit a scenario · (833) 264-7776
C-PACE availability, eligible measures, leverage limits, and terms are set by DC PACE, Montgomery County MC-PACER, the Virginia PACE Authority, Arlington County, and other local programs. Verify current rules with the program administrator. Examples are illustrative composites. Bridge financing at 8.99%–13.5% interest-only and DSCR at 5.75%–10.5% apply to qualified Jaken Finance Group files and are subject to change.