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Hannon Armstrong Sustainable Infrastructure Capital, Inc. Acquires $107 Million Portfolio of Land and Leases for Solar and Wind Projects 

May 28, 2014   Hannon Armstrong(NYSE: HASI), a leading sustainable infrastructure investor, today announced the acquisition of a $107 million portfolio of land and payments from land leases underlying wind and solar projects. HASI also entered into an expansion of its existing credit facility, which provides for an additional $200 million of capacity and increased flexibility in terms. “We have acquired high credit quality, long duration lease streams that are senior to the project debt in some of the largest solar and wind projects in the country,” said Chief Executive Officer Jeffrey Eckel. “This portfolio diversifies our asset mix while moving us toward our 2014 financial targets and adds another platform for originating new assets that fit well with our REIT structure.”

Highlights: Acquired more than 7,500 acres of land leased to three solar projects with a value of approximately $60 million and the payments from 11 additional land leases for a diversified portfolio of wind projects with a value of approximately $27 million. In addition, another portfolio of 46 smaller streams of payments from land leases on wind projects was also purchased. The land and leases purchased support wind and solar projects developed or owned by high credit quality entities, including Southern Company, NRG Yield, First Solar and NextEra, with long term investment grade power purchase agreements from utilities such as SDG&E, PG&E, LADWP and SCE. “Strategically, this transaction is a terrific fit: It adds high credit quality assets at attractive risk-adjusted yields, grows our near term pipeline and increases our capacity to add distributed energy assets by expanding our REIT asset base,” said Eckel. “In addition to the long duration assets, we now will enjoy equity upsides from long-term land ownership, all the while taking the least risk in the project capital stack,” added Eckel.

The Transaction: The transaction is structured as a purchase of American Wind Capital Company, LLC with no debt, liabilities or employees. Existing employees and management will form a new company named AWCC Capital, LLC to originate additional transactions in which HASI has a right of first refusal to purchase additional transactions.

Expansion of Credit Facility: HASI has also expanded its existing credit facility by increasing its overall capacity by $200 million. The new terms provide an increase in the maximum borrowings allowed at any point in time in the project finance facility from $150 million to $250 million, and an increase in the total maximum advances allowed under the facility from $700 million Hannon Armstrong Sustainable Infrastructure Logo. (PRNewsFoto/Hannon Armstrong Sustainable Infrastructure Capital, Inc.) million to $250 million, and an increase in the total maximum advances allowed under the facility from $700 million to $900 million. The amendment also expanded the eligibility criteria to reflect current market opportunities in distributed energy assets. “The expansion of our credit facility, combined with our recent equity offering, provides us with additional financial resources to continue to grow our business,” said Chief Financial Officer Brendan Herron. “Aligning our credit facility with the market opportunities is key to ensuring optimal leverage in our capital structure.”

About Hannon Armstrong: Hannon Armstrong makes debt and equity investments in sustainable infrastructure projects. The company focuses on profitable projects that increase energy efficiency, provide cleaner energy, positively impact the environment or make more efficient use of natural resources. Hannon Armstrong targets projects that have high credit quality obligors, fully contracted revenue streams and inherent economic value.

The company, based in Annapolis, Maryland, intends to elect and qualify to be taxed as a real estate investment trust (REIT) for federal income-tax purposes, commencing with its taxable year ended Dec. 31, 2013.

Forward Looking Statements: Some of the information contained in this press release are forward-looking statements and within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. When used in this press release, words such as “believe,” “expect,” “anticipate,” “estimate,” “plan,“continue,” “intend,” “should,” “may,” “target,” or similar expressions, are intended to identify such forward-looking statements. Forward-looking statements are subject to significant risks and uncertainties. Investors are cautioned against placing undue reliance on such statements. Actual results may differ materially from those set forth in the forward-looking statements. Factors that could cause actual results to differ materially from those described in the forward-looking statements include those discussed under the caption “Risk Factors” included in our Annual Report on Form 10-K for our fiscal year ended December 31, 2013, which was filed with the U.S. Securities and Exchange Commission (SEC), as well as in other reports that we file with the SEC. Forward-looking statements are based on beliefs, assumptions and expectations as of the date of this press release. We disclaim any obligation to publicly release the results of any revisions to these forward-looking statements reflecting new estimates, events or circumstances after the date of this press release.


Investor Relations:

Marathon Capital Advises American Wind Capital Company on Sale of Portfolio and Company

Chicago, IL – May 28, 2014 – American Wind Capital Company (“AWCC”), the market leader in monetizing longterm, contracted ground rent / ground lease agreements in high-quality solar and wind projects, has been sold to Hannon Armstrong Capital, LLC and its affiliate Hannon Armstrong Sustainable Infrastructure Capital, Inc., for $106,650,000. Marathon Capital, LLC acted as exclusive financial advisor to AWCC for this transaction. AWCC currently owns leases on more than 40 projects, representing more than 1,000 MWs of solar and wind generating capacity located in 14 US states. These leases produce long-term, stable, contracted cash flows that are senior in priority. While monetizing wind lease payments has been occurring for some time, separating the underlying land from solar projects is a relatively new concept, and one that brings significant, accretive, benefit to the solar asset owner. Contemporaneously with the sale, Hannon Armstrong entered into a mutually exclusive agreement with AWCC Capital, which is made up of the AWCC management team, to continue to originate solar and wind related real estate transactions. AWCC has a significant pipeline of future transactions and anticipates strong future growth in association with its new ownership. AWCC’s CEO, Chuck Hinckley, said “this is a great deal – Hannon Armstrong is getting an exceptional portfolio of renewable related real estate assets, and AWCC Capital has access to a superior source of capital to continue providing value adding real estate solutions to solar and wind developers and landowners. The combination of our experience in this market and Hannon’s financial support create an opportunity for powerful growth.” “Marathon did a superior job creating a win, win, win for the selling shareholders, Hannon Armstrong the Buyer, and management who will continue to operate the business”, Hinckley said.

About Marathon Capital: Marathon Capital is a leading financial advisory and investment banking firm focused on providing financial advice in the areas of M&A, debt and equity capital raising, project financing, tax equity, financial restructuring, recapitalization, bankruptcy and workout situations in the global energy and infrastructure markets. Marathon Capital was named “Best Renewable Asset M&A Advisor” in 2013 by Power Finance and Risk.


CIT Serves as Lead Arranger in $100 Million Renewable Energy Land Lease Financing

NEW YORK–(BUSINESS WIRE)–CIT Group Inc. (NYSE:CIT), a leading provider of financing and advisory services to small businesses and middle market companies, today announced that it arranged a $100 million senior secured credit facility for AWCC Holdings LLC, a subsidiary of American Wind Capital, to acquire a portfolio of land leases from solar projects from Hawaii to New York.

CIT Corporate Finance, Energy served as Lead Arranger in the transaction and financing was provided by CIT Bank, the U.S. commercial bank subsidiary of CIT. Terms of the transaction were not disclosed.

“This unique financing will allow AWCC to further grow its portfolio of land leases and lease royalties throughout the United States,” said Mike Lorusso, Managing Director and Group Head of CIT Energy. “This transaction allowed us to showcase our range of creativity and capabilities in the renewable energy sector in structuring a deal that benefited all parties.”

American Wind Capital’s CEO Chuck Hinckley said, “CIT and AWCC have structured an innovative and first of its kind financing for both our existing portfolio as well as a flexible facility that will allow us to expand our business. We acquire and lease the real estate underlying utility scale solar power projects, allowing project sponsors to optimize their capital structures. To date, we have acquired over 8,000 acres under 540MW of operating solar projects. Given the robust pipeline of solar projects in development across the U.S., we see tremendous growth potential in this business segment. In our traditional business of monetizing wind power project rents for landowners, we provide landowners that host windpower projects with an important source of liquidity that allows them to retain ownership of their land. We expect CIT to be an outstanding partner as we expand our portfolio in both of these business segments.”

About CIT

Founded in 1908, CIT (NYSE:CIT) is a bank holding company with more than $35 billion in financing and leasing assets. It provides financing and leasing capital and advisory services to its clients and their customers across more than 30 industries. CIT maintains leadership positions in small business and middle market lending, factoring, retail finance, aerospace, equipment and rail leasing, and vendor finance. CIT operates CIT Bank(Member FDIC), its primary bank subsidiary, which, through its online bank, offers a suite of savings options designed to help customers achieve a range of financial goals.

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