In the rugged beauty of far West Texas, historic hotels have long served as gateways for travelers exploring the region’s mountains, telescopes to the heavens, desert parks, and vibrant arts communities. Preserving these properties often requires more than restoration, it requires creative financing solutions that make modernization possible while protecting the character that makes these historic properties special.

A recent 3-project TX-PACE transaction demonstrates how that can happen. Three historic boutique hotels, the Hotel Limpia in Fort Davis, Texas and the Holland Hotel and Maverick Inn in Alpine, Texas, are  benefiting from energy and water efficiency improvements supported by $6 million in TX-PACE financing.

Developed by Byways Hospitality Group and financed through a TX-PACE loan provided by Peachtree Group, the portfolio demonstrates how sustainable infrastructure investments can strengthen rural tourism assets while reducing long-term operating costs.

A Portfolio Approach to Modernizing Historic Properties

Rather than financing each hotel individually, the project team structured the transaction as a single portfolio TX-PACE loan spanning three properties across Jeff Davis  and Brewster counties.

This approach allowed the developer to implement efficiency upgrades across multiple buildings while simplifying the capital stack and improving project economics.

The TX-PACE financing supports a range of improvements designed to reduce energy and water consumption while improving guest comfort:

• Building envelope improvements
• Electrical and LED lighting upgrades
• High-efficiency HVAC systems, including split systems and variable refrigerant volume technology
• Plumbing upgrades and water conservation measures
• Cool roof systems, glazing, and insulation improvements

Together, these measures will help reduce operating costs and extend the useful life of the historic buildings.

“Historic properties require thoughtful investment,” said Collin Bibb, Partner with Byways Hospitality. “With these improvements, we're making the hotels more comfortable, energy-efficient, and water-efficient for guests, which will help ensure they can operate for another 100 years."

Creative Financing Keeps the Project Moving

One of the most unique aspects of the transaction involved overcoming an unexpected funding delay.

The project team had anticipated complementary funding through a rural development program from the United States Department of Agriculture. However, after more than a year waiting for a response on the timing of those funds, the project risked further delays.

Rather than allowing the improvements to stall, Peachtree Group structured a bridge loan to cover the anticipated USDA funding until those funds are ultimately disbursed. This creative approach allowed the developer to proceed with the energy and water improvements without waiting indefinitely for the federal funding timeline to resolve.

“This transaction demonstrates how we are leveraging our USDA lending platform alongside C-PACE financing to deliver a comprehensive capital solution,” said Zach Chandler, senior vice president of strategy, government lending at Peachtree. “By integrating government-guaranteed lending into our broader credit strategy, we are able to support both the repositioning of these historic assets and their long-term financing needs.”

Supporting Rural Communities Through Sustainable Investment

In smaller communities like Fort Davis and Alpine, historic hotels serve as more than lodging, they are economic anchors supporting restaurants, tourism, outdoor recreation, and cultural events.

Investments that reduce energy and water costs can significantly improve the long-term viability of these properties, particularly in rural markets where operating margins can be tight.  West Texas communities also experience oversized positive impacts when precious water and energy resources are freed up and increase local resiliency. These tourism-driven rural communities enjoy community-wide revitalization when historic hotels’ improvements enhance visitors’ experiences.

The improvements financed through TX-PACE will help position these hotels to remain competitive while preserving the architectural character that draws visitors to the region.

“Projects like this demonstrate how energy efficiency investments can strengthen local tourism assets, which are the main driver of our rural economy” said Annette Gutierrez, Executive Director of The Rio Grande Council of Governments. “Preserving historic properties so they perform efficiently is an invaluable investment in the future of our region.”

Coordinating a Multi-County TX-PACE Project

Texas PACE Authority helped guide the transaction from concept through closing, working with project partners and local governments in both Jeff Davis County, Texas and Brewster County, Texas.

Because the project involved properties located in two jurisdictions, coordination across counties was essential. Texas PACE Authority supported the project team by confirming program eligibility, reviewing the proposed efficiency measures, and managing the administrative steps required to close the TX-PACE financing under each county’s program.

For rural communities with limited staff capacity, having a program administrator manage these processes helps ensure projects move forward efficiently while maintaining compliance with TX-PACE program guidelines.

About Texas PACE Authority

Texas PACE Authority is a nonprofit organization that administers TX-PACE programs on behalf of more than 100 counties and municipalities across Texas. TX-PACE (Texas Property Assessed Clean Energy) enables commercial property owners to access long-term, fixed-rate financing for energy efficiency, water conservation, resiliency, and renewable energy improvements.

Through the program, property owners can finance qualified improvements and repay the financing through a voluntary property assessment. This structure allows building owners to spread the cost of improvements over time while benefiting immediately from lower operating costs and improved building performance.

By working collaboratively with property owners, lenders, contractors, and local governments, Texas PACE Authority helps communities across Texas modernize buildings, conserve resources, and support local economic development. For more information, contact Texas PACE Authority.  Texas PACE Authority Website