REAL ESTATE NEWS

Nuveen is pouring another $785 million into its C-PACE Lending Fund III, which provides commercial properties financing to make climate-friendly improvements.

The strategy targets insurance firms that hold investment-grade assets. Building upgrades may include water conservation and other methods to bolster energy efficiency.

The benefits of C-PACE in general are two-fold. Not only does it support capital expenditures for climate-friendly properties — but it potentially produces "long-dated, steady returns," for those investors, according to Nuveen.

The global asset manager, with total holdings of $1.3 trillion, has allocated more than $6 billion toward C-PACE strategies since its inception. Also, a recent Nuveen survey found that 93 percent of insurers, when looking for investments, consider the social or environmental ramifications.

Moreover, in 2024 alone, C-PACE financings in general supported the building of 2,100 housing units, preserved more than 461 million gallons of water, and conserved over 585 megawatt hours of energy.

The company teamed up with its sustainable CRE financing provider affiliate, Nuveen Green Capital (NGC), in the latest capital commitment to Fund III.

"NGC's vertically integrated platform brings investors scaled and proprietary flow of C-PACE assets with established sponsors with both compelling economics and positive social impact," said Alexandra Cooley, chief investment office and co-founder of NGC.

"For property owners, this fund enhances NGC's balance sheet lending capabilities and our readiness to provide attractive financing that improves buildings' bottom lines."

In 2025, elevated interest rates have scared away some CRE investment activity, along with trade policy concerns. However, developers have remained interested in climate investments, as noted recently by John Chang, Marcus & Millichap’s chief intelligence and analytics officer. And going forward, he noted that the "performance outlook remains positive" in the sector.

Source: GlobeSt/ALM