IN 2000, SHEA PROPERTIES put 10-year debt under the Elan at River Oaks , a 941-unit residential building with 23,000 square feet of commercial space in San Jose, Calif., that the company had built in 1991. During the past decade, Shea saw rents rise and fall and completed a $15 million renovation of the property, including unit upgrades and a complete clubhouse facelift. But come 2010, Shea still had $120 million of existing debt (with a substantial pre-payment penalty) that was set to expire on May 3. The clock was ticking.

In late April, just in the nick of time, Walker & Dunlop originated a 10-year, $138.9 million loan under Freddie Mac 's Capital Markets Execution (CME) program to retire the existing debt. The loan was closed less than two weeks after rate lock and has been the biggest Freddie Mac financing of the year to date.

“Having a deal to take 15 percent of your pool under CME is quite an accomplishment,” says Verne L. Murray III, senior vice president of multifamily finance for Bethesda, Md.-based Walker & Dunlop.

Robert O'Dell, vice president and treasurer of Aliso Viejo, Calif.-based Shea Properties, says there was a collective sigh of relief when the deal closed, even though the wheels had been in motion since early February. “Since it was a large pool, a lot of elements of the CME program had to apply,” O'Dell says. “It received a lot of legal attention, but it was a good loan.”

So good, in fact, that Shea is working on two additional CME loans, although O'Dell admits that he'd rather secure a traditional Freddie Mac loan (akin to the earlier 10-year loan for Elan at River Oaks). “If I had my druthers, I would prefer the traditional package,” O'Dell says. “We have avoided CMBS in the past because you'd always want to have control over your loan relationships.”

But the higher proceeds and size of the deals can make CME a more viable option. “You have to take what's available to give you the proceeds and execution that you want,” he says. “We're in new territory than we've been in the past. Given the size of this deal, this was what was available to us at these terms. Not everybody can deliver a $139 million deal.”

At least now O'Dell knows what to expect. “We've created a template that we can replicate for future deals,” he says.