Mayfly Outdoors
Mayfly Uses $1 Million in C-PACE Financing to Build New Headquarters
Project incorporates energy efficiency into building design
The Challenge
Mayfly Outdoors is building a new headquarters and manufacturing facility in Montrose, Colorado. Energy efficicency is a major concern, because the high-precision machines the company uses to make its premium fly-fishing equipment and other outdoor products use a great deal of electricity. What’s more, the aerospace-grade parts Mayfly manufacturers require it to tightly control ambient tempatures. This is not easy to do in a high-altitude, low-humidity environment with four distinct seasons, and can quickly drive up enery costs.
“C-PACE provides the avenue to monetize energy-efficiency improvements. The program was an important factor in getting the project done.”
—David Dragoo, president, Mayfly Outdoors
The Solution
To ensure that its new manufacturing facility would be as efficient as possible, and therefore less expensive to run, Mayfly’s architect designed the building to comply with the 2015 International Energy Conservation Code, which is more stringent than local code.
To fund the project, Mayfly President David Dragoo considered traditional finacing, but after local economic development officials introduced him to C-PACE, he added it to the capital stack. “C-PACE provides the avenue to monetize energy efficiency improvements and was an important factor in getting the project done,” he said.
The Impact
C-PACE facilitated $994,500 in affordable, long-term, non-recourse financing for Mayfly Outdoors’ new headquarters. (Because the new building’s design complies with the 2015 IECC, Mayfly was eligible for C-PACE financing for up to 15 percent of the project’s construction cost.) Dragoo used the financing to displace a portion of traditional debt, lowering the company’s weighted average cost of capital.
Dragoo says his only stumbling block with C-PACE was a good one. “C-PACE is new, so it took time to get our banking and legal teams aligned with the structure.” He said the program representatives and the private capital provider he found through the program provided clarity when his team needed it.
To decide which energy-saving measures to include in the project, Mayfly looked at its energy use and maintenance costs. “We concluded that LED lighting, low-e glass, engineered concrete, and geothermal were the way to go,” Dragoo said, adding that the new facility will nearly double current operations. Notably, the facility is also one of the first buildings in the newly announced Colorado Outdoors Project, a 164-acre re-development along the Uncompahgre River.
About Colorado C-PACE
Colorado C-PACE provides financing for energy efficiency, renewable energy and water efficiency improvements, including new heating/cooling systems, lighting, water pumps, insulation, and renewable energy projects for commercial properties. C-PACE offers long-term financing that covers 100 percent of the project cost and is repaid over a period of up to 25 years as a line item on the existing property tax bill. Because the loan runs with the property, if the building is sold, the repayment obligation cantransfer to the new owner, who enjoys the ongoing utility cost savings associated with the project.
By the Numbers
Project Type:
New Construction
Building Type:
Office/Manufacturing
Building Size:
41,000 square feet
C-PACE Project Cost:
$994,500
Total Construction Budget:
$7.5 million
Finance Term: