PACE Loan Group Powers Kansas City AI Data Center Project With $100M C-PACE Loan

Patmos Hosting has lined up $100 million of Commercial Property Assessed Clean Energy (C-PACE) financing to complete an AI data center development in Downtown Kansas City, Mo., Commercial Observer has learned.

PACE Loan Group (PLG) originated the C-PACE loan for Pastmos’ 421,112-square-foot, four-story Patmos AI Campus project at the former Kansas City Star building. Proceeds from the debt, which marks the largest C-PACE deal in Missouri history, will fund energy-efficient improvements at the 35-megawatt facility and support its electrical infrastructure. 

The C-PACE proceeds will be used for energy-efficiency, equipment, HVAC and plumbing improvements to the property to support the data center’s cooling and electrical load.

The project is expected to be completed in March 2026. Multiple tenants have signed lease including AI firm Nebius, according to PLG. 

“With this loan, Patmos is able to continue to deliver on our speed to market promise for our clients while creating an AI Campus that serves as the technology hub for one of the fastest expanding regions in the industry,” John Johnson, founder and CEO of Patmos, said in a statement. “The PLG team understood our vision at every turn and worked to deliver a solution that was as unique as our business model.”

Patmos commenced construction of the facility in late 2024 with 12 megawatts built over 180 days.  In addition to building the data center campus, Patmos is also converting nearly 150,000 square feet of the former newspaper building into a multi-tenant technology hub with coworking and event space. 

The Patmos AI Campus is at 1601 McGee Street in Downtown Kansas City, just south of the events and sports venue known as T-Mobile Center. The McGee Street site was previously explored as a stadium location for the Kansas City Royals before the Major League Baseball club declined an offer by the city. 

“C-PACE made a lot of sense for this renovation,” Rafi Golberstein, CEO and founder of PLG, said in a statement. “Many of the conversion costs were eligible, and the long-duration capital is well aligned with Patmos’ business plan.”

Robbie Pinkas, senior vice president at PLG, added in a statement that C-PACE is conducive for data center projects because of energy efficiency improvements making a “big impact  on their bottom line.” 

Andrew Coen can be reached at acoen@commercialobserver.com.