Vert Investment Arranges Retained-Interest Financing for Oregon Wind Farm

The Vert-arranged financing for PaTú wind power includes a retained interest in the project for OTWF and involves $5.685 million in preferred equity from a group of high net-worth individuals and a $16.5 million construction loan from a leading agricultural lending institution. Long-term debt of $12 million is anticipated to be provided by an Oregon state funding program. The deal allows OTWF to exercise a call option at the end of the fifth year to retain full ownership of the wind energy project.

Ormand Hilderbrand, president of Oregon Trail Wind Farm, a family-owned corporation, said he has been working on PaTú since 2005, but several obstacles delayed its financing. “An original investment partner backed out of the project, we had difficulty securing a turbine agreement, changes were mandated in the power purchase agreement and the financial markets collapsed – all contributed to delays.

“I turned to Vert Investment Group in late 2009 to help negotiate the power purchase agreement, the interconnection agreement and the turbine supply agreement, then lead us to secure project financing,” Hilderbrand said.

“I was very pleased with Vert,” Hilderbrand said. “I’ve had experience with other parties trying to put financial packages together. To be quite frank, either they didn’t understand project finance or didn’t understand renewable energy.

“Vert Investment understands both and was willing to gamble with a small project. I was fortunate to have Vert Investment with me,” he said.

“I had strong support from Vert. They did yeoman’s duty early in the morning, late at night, over weekends. Vert was an integral part of our success in obtaining financing,” Hilderbrand said.

“I’m looking past PaTú to other wind turbines developments,” Hilderbrand said. “I want to develop projects for other agricultural landholders in Oregon, Washington and Idaho and I look to Vert to be a partner in those developments as well,” he said.

“Vert has been tested. I know people who have been tested and failed. Having been tested and achieving success is important. I fired other groups because they just didn’t succeed. Vert passed the test and I was very pleased to have them as a partner in the PaTú development,” said Hilderbrand.

“The whole process took longer than I’d expected but it made the project stronger. PaTú now has very strong legs,” he said.

Vert Investment Understands Landowner Interests, Clears Hurdles to Finance Utility-scaled Wind Projects

Joaquin Altenberg, Vert Investment’s managing partner, said, “Smaller wind energy projects often fall outside the scope of many equity investors’ and lenders’ appetites due to their preference for larger economy-of-scale projects backed by established developers.

“Making things more difficult for small-to-medium sized wind energy developments, the aftermath of the credit crisis left very few banks lending to renewable energy projects,” Altenberg said.

“Although PaTú has excellent wind resources and other attractive attributes, the investment community’s bias for larger projects combined with stringent lending requirements after the 2008 financial meltdown created barriers that required a special approach to obtain financing,” he said.

“Vert Investment has deep experience in wind energy specifically, in renewable energy generally and in project finance. We understand how to serve the interests of land owners as well as meet investor expectations for utility-scaled wind energy projects,” said Altenberg.

“Regardless of project size, it is always a privilege to help entrepreneurs realize their goals,” Altenberg said. “It’s one of the most compelling aspects of our business in renewable energy finance.”

Hilderbrand endorsed Vert’s expertise and cooperative support. “There would have been doubt without Vert. I could have succeeded but it would have taken longer. It would have been much more time-consuming and I probably would have made a lot more false starts.

“I would have had to develop a team to do everything that needed to be done, but with Vert, I had a good team from day one,” Hilderbrand said.