Inside the Solar Lending Fund's First Two Repayments

September 9, 2026

By Max Jackson, Managing Director - Private Credit Portfolio Manager

When we launched the solar lending fund (Real Estate Private Credit or “REPC1”), our thesis was simple. Regional and community banks that once financed the development phase of mid-size solar developments have largely exited that business, squeezed by tighter capital requirements and a preference for larger, more standardized borrowers. That retreat left a financing gap for well-structured, portfolios of pre-shovel-ready projects in the 5- to 25-megawatt range, and we believed a disciplined private lender could step into it profitably while taking on less risk than the yield would suggest.

The fund's first two loans put that thesis to the test, and both have now been repaid in full, on schedule, and at the underwritten return.

How we underwrote these loans

We do not lend against a solar project's potential. We lend against a project that has already cleared the key milestones that most often stall or kill a development and are at the top of the interconnection approval queue. By the time our capital is at work, we are collateralized by a large number of projects, each with a clear path to completion. The primary risk we are underwriting is execution of the last stages of development and the sales process, where our own investment banking team can help reduce sales execution risk.

What the first two repayments tell us

Both loans in question financed the last stages of development and the interconnection costs of community solar development projects that were already at the top of the utility interconnection queue. Each loan was repaid at maturity, in full, at the coupon we underwrote at closing. Neither loan required a workout, an extension, or a change in terms, but if they did, we typically structure our loans as senior secured in a first-lien position.

That is not a large enough sample to declare victory, and we would not put it that way ourselves. What it does confirm is that the underwriting process holds up in practice the way we intended it to on paper as we laid it out at the outset of the fund, which is the reason we are comfortable expanding this strategy.

Where we see the opportunity from here

The financing gap that created this opportunity has not closed. If anything, it has widened, as state-level support for renewable energy runs into a development lending market that remains thinner than it was five years ago, while power demand becomes ever more voracious with the onset of ever larger AI data centers. We believe that gap between demand and supply will persist for the foreseeable future, and it is the foundation for the next phase of our renewable energy lending strategy, which we look forward to sharing with you in the coming weeks.

If you have questions about the solar lending fund REPC1, our underwriting process, or how this strategy might fit into your portfolio, please reach out to your Ballast Rock Asset Management Investor Relations team at ir@ballastrock.com.