MCLEAN, VA--(Marketwired - Jan 29, 2014) - Freddie Mac (OTCQB: FMCC) announced today that it had another strong year with $25.9 billion in volume for its multifamily business (loan purchase and bond guarantee volume) -- the second biggest volume year in its history. The largest yearly volume of $28.8 billion occurred the previous year in 2012.
This volume includes Freddie Mac's targeted affordable housing products, which finance apartments that receive some form of local, state or federal government subsidy and have rents that are affordable to individuals earning up to the local area median income. It also reflects the $25.9 billion loan purchase cap for 2013 established by the company's conservator, the Federal Housing Finance Agency.
Quotes from David Brickman, senior vice president of Freddie Mac Multifamily:
- "2013 was a very good year for us, and the apartment market remains very healthy. Strong demand and limited supply have kept vacancy rates low and pushed up rents in the majority of markets we track."
- "The lack of affordable rental housing is a growing issue in the country. With rents rising faster than incomes and limited affordable construction, it's getting harder for many households to find apartments they can afford. We continue to do what we can to support affordable rental housing. In 2013 we focused on increasing our efforts in preservation financing for apartments that receive government rent assistance or low-income housing tax credits. Many of these properties were built before 1990 and typically are in need of capital improvements."
- "It was a record year for our multifamily securitization program with $28 billion in completed K-Deals. We are the most prolific issuer of CMBS backed by multifamily mortgages since the market crash in 2009 and expect to securitize approximately $25 billion in multifamily loans in 15 to 20 K-Deals next year. However, this is dependent upon FHFA's guidance for 2014, which has not yet been announced."
Freddie Mac Multifamily 2013 Business Highlights:
- Produced more than $6 billion in segment earnings since 2010. This includes $1.82 billion in the first nine months of 2013. (Fourth quarter 2013 earnings data has not yet been released);
- Issued a record $28 billion in multifamily securities through 19 K-Deals in 2013, up from $21.2 billion and 17 K-Deals in 2012. Since the program started in 2009 and through yearend 2013, Freddie Mac has sold $71.5 billion in UPB of multifamily loans through 56 K-Deals, which represents approximately $10.5 billion in unguaranteed CMBS securities and $61 billion in Freddie Mac issued and guaranteed securities;
- Welcomed the announcement that effective June 30, 2014, K-Deals will be included in the Barclays Aggregate U.S. and Global Bond Index -- a recognition of the growing importance of the Agency CMBS sector;
- Settled roughly $2.5 billion in targeted affordable housing products of which approximately $1.6 billion were multifamily bond credit enhancements and Tax-Exempt Bond Securitizations (TEBS);
- Purchased just over $900 million in seniors housing mortgages;
- Transacted more than $1.1 billion in student housing loans;
- Provided financing for nearly 1,600 properties amounting to almost 388,000 apartment units, of which the majority are affordable to families earning low or moderate incomes;
- Reported a low delinquency rate of 9 basis points as of December 31, 2013, reflecting our continued strong portfolio performance. (Delinquencies are based on the unpaid principal balance of mortgage loans that are two or more monthly payments past due or in the process of foreclosure.); and
- Achieved a commercial mortgage-backed securities (CMBS) special servicer rating of CSS2- and a CMBS master servicer rating of CMS2 from Fitch; and a commercial mortgage special servicer ranking of MOR CS2 and a commercial mortgage trust advisor ranking of MOR TA3 from Morningstar Credit Ratings, LLC.
Click here to read the 2012 business volume press release.
Since the launch of Freddie Mac's multifamily business in 1993, it has provided more than $316 billion in financing for about 61,000 multifamily properties.
Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Today Freddie Mac is making home possible for one in four homebuyers and is one of the largest sources of financing for multifamily housing. www.FreddieMac.com. Twitter: @FreddieMac