In our extensive experience evaluating financing requests for solar projects on Multifamily Affordable Housing (MFAH) properties, one challenge repeatedly stands in the way: the restrictive terms of primary debt.
Loans from HUD, FNMA, and FDMAC often prohibit property owners from taking on secondary debt without lender approval. This approval process, when available, can be slow and cumbersome, frequently halting solar adoption altogether. While the structure and incentives for solar financing are highly advantageous, this obstacle has been insurmountable for many MFAH properties—until now.
A Game-Changing Solution with TBL Fund and SOMAH
TBL Fund, in collaboration with our innovative non-profit partner, Finance for Impact (FFI), has developed a unique solution made possible by California’s substantial SOMAH rebates. FFI was specifically created to facilitate solar adoption by temporarily owning solar facilities.
Here’s how it works:
- FFI Ownership: FFI owns the solar facility temporarily. The property provides a no-cost roof lease to FFI, while FFI supplies solar power to the property through a no-cost Power Purchase Agreement (PPA).
- TBL Fund Financing: TBL Fund finances the solar facility with FFI as the borrower, utilizing the SOMAH rebates to fund the project.
- Transition of Ownership: After installation, SOMAH rebates repay the financing, and FFI transfers ownership of the solar facility to the property at no cost.
This structure ensures that the property and its tenants benefit from solar energy savings without any upfront or ongoing cost.
The Impact
With nearly $100 million in annual SOMAH funding, this solution represents an extraordinary opportunity to:
- Improve tenant utility savings and enhance housing affordability.
- Increase property value without additional debt.
- Create job growth in the clean energy sector.
- Contribute to California’s sustainability goals by reducing greenhouse gas emissions.
Seize the Opportunity
This is more than a financing solution—it’s a pathway to unlock the potential of solar for MFAH properties, delivering social, economic, and environmental benefits. Together, we can transform challenges into opportunities and make a lasting impact.