PACE Equity deal first in nation to combine PACE funding and OZ fund

PACE Equity has completed funding $4.3 million for the construction of a new Hyatt House hotel in Rochester, Minn.

It is the first opportunity-fund project for PACE to fund to date.

The 175-key, extended-stay hotel will be located at 315 First Ave., near Mayo Clinic’s downtown campus. The property was the site of the former American Legion Post 92, where Mayo Clinic founders William J. Mayo and Dr. Charles H. Mayo were members in the early 1900s. The new Hyatt House will serve the patients and clients of Mayo Clinic, filling a need in the area.

The developers, California-based EKN Development Group and its co-developer, initially did their own energy study, which qualified them for only $400,000, 10 percent of the $4.3 million for which they desired to utilize PACE. They then turned to PACE Equity, whose engineering and regulatory expertise enabled them to commit up front — and ultimately fund — the full $4.3 million. The remainder of the capital stack was