SolarCity Corp. completed its fifth securitization of distributed solar PPA and lease assets recently the company’s sixth securitization transaction to date. SolarCity completed a private placement that resulted in proceeds of $49.6 million—$3.13 per watt of generation capacity in the portfolio inclusive of previous tax equity financing—with a yield rate of 6.25%.
“Securitization continues to be a cost-effective financing mechanism for us, even in a volatile market, which reflects the quality of our distributed solar assets and the reliability of these cash flows,” said Radford Small, Executive Vice President, Capital Markets. “In this transaction we received $3.13 of financing per watt of solar generation capacity in the portfolio, well outpacing the $2.71 per watt installation cost we achieved in Q4 2015.”
SolarCity’s pool of solar PPA and lease contracts received investment grade ratings of BBB+ from Kroll Bond Rating Agency and BBB from Standard & Poor’s. These ratings reflect the predictability and quality of the cash flows and the minimal operation and production risk of solar assets.Goldman, Sachs & Co. and Credit Suisse Securities (USA) LLC acted as co-structuring agents and co-bookrunners for the transaction.