Energy continues to grow as a significant factor in commercial real estate operational cost, asset performance, market valuation and therefore provides an opportunity to create compelling investment returns.
The Opportunity:
The energy related financial constraints facing mid-market CRE properties is creating significant upside opportunity for investors and lenders due to deferred maintenance and higher energy costs. Operating expenses are increasing rapidly due to energy spend exacerbated by shocks and stressors such as electrification, EV-demand, extreme weather events, and AI data centers requiring unprecedented energy demand.
Peak demand load constraints on the various energy grids across the Country is reaching unprecedented levels and there are new grid-interactive incentives for commercial real estate to achieve significant energy savings and revenues through strategic investments in energy optimization software, building control technology, efficiency, renewables and storage.
Energy Resiliency bridge lending can support both (1) the fundamental efficiency / mitigation of deferred maintenance; and (2) systems and software needed for grid-interactive commercial real estate investments.
