SolarCity Corp. has raised $305 million in its second cash equity transaction. A private investment fund affiliated with Quantum Strategic Partners Ltd. and advised by Soros Fund Management LLC provided the investment in a portfolio of residential, commercial and industrial solar projects.
The transaction also included a fully amortizing, 18-year loan that was syndicated to five institutional investors.
The portfolio of projects in the transaction collectively represents 230 MW of solar generation capacity spread across 15 states. The vast majority of the installations were completed in 2015 and 2016.
By placing the equity investor and lender group separately, SolarCity says it was able to achieve a pre-tax, weighted average cost of capital of 7.4% – a significant improvement over its first cash equity transaction.
The loan was rated investment-grade by a credit rating agency, and the financing is non-recourse to SolarCity. Bank of America Merrill Lynch acted as the sole syndication and structuring agent for the transaction.
SolarCity says it held $5.2 billion in solar energy system assets on its balance sheet at the end of its most recently reported quarter on June 30. Those assets are contracted to create $3.1 billion in future payments on a net present value basis, and SolarCity expects to continue executing additional transactions in the future in order to monetize its contracted cashflows.