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ARTICLE · 04 NOVEMBER 2026

C-PACE Financing Can Be A Useful Part Of A Data Center's Capital Stack

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As data centers face mounting energy demands from AI and advanced computing, developers are turning to innovative financing solutions to fund critical infrastructure. C-PACE financing offers a unique approach by allowing property owners to finance energy-efficient improvements through property tax assessments, potentially replacing more expensive mezzanine debt in the capital stack. Recent landmark deals in Missouri and Texas demonstrate how this financing mechanism can address the challenge of funding powe

United StatesFinance and Banking
Glenn S. Miller
Glenn S. Miller
Abe M. Salander
Abe M. Salander
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Real Estate Partner Glenn Miller and Counsel Abe Salander authored an article in the Commercial Observer on how Commercial Property Assessed Clean Energy (C-PACE) financing can help data center developers pay for the power, cooling and other infrastructure behind increasingly energy-intensive computing. C-PACE financing allows commercial property owners to finance qualifying energy, water, renewable energy and resilience improvements through an assessment on the property, which is repaid through the property tax bill, typically over 10 to 20 years.

“The data center boom faces a financing challenge: developers must fund not only the buildings themselves, but also the power, cooling and other infrastructure required to support increasingly energy-intensive computing,” Glenn and Abe wrote. They pointed to two recent deals as examples, with the first being a $100 million C-PACE loan through Missouri's Show Me PACE program for Patmos Hosting's 35-megawatt artificial intelligence (AI)

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