The multifamily business is booming for the government-sponsored enterprises (GSEs).
Freddie Mac announced Wednesday year-end closing volume for the multifamily business was $28.3 billion, the second largest number in the firm's history. Meanwhile, Fannie Mae closed out 2014 with $28.9 billion in transaction volume, according to the website.
The 2014 volume was up 10% compared to the $25.9 billion Freddie Mac did in 2013, though it fell behind 2012’s record-breaking $28.8 billion, David Brickman says.
Brickman, executive vice president for the multifamily business, says his team could have done more transactions, but wanted to stay in compliance with the cap that the Federal Housing Finance Administration had put on their volume. About $800 million worth of transactions were put on hold and carried over into this year, and this year’s cap has been increased to $30 billion for Freddie Mac.
“We were very excited to see the increase in the cap so that we’ll have some additional room to grow,” Brickman says.
Freddie Mac provided financing for about 1,800 properties comprised of 427,000 units last year. Freddie also purchased over $1.2 billion in senior housing and closed about $1.3 billion in student housing transactions. Meanwhile, the Freddie Mac team started a small-loan initiative last year, and began offering a tax-exempt loan product.
The team hopes to start offering a new value-add product for market-rate deals this year, in addition to a similar acq-rehab program aimed at preserving older affordable housing.
“We want to be covering every square foot in the multifamily space whether it’s A properties or C properties, whether its stabilized properties or not stabilized properties---that’s where the renovations and rehab stuff comes in,” he says. “I think we’re getting there with these new offerings, where we are covering the entire page and continuing to fill it in.”
The GSE has provided more than $344 billion in financing for about 63,000 multifamily properties since 1993, when the multifamily branch of the business started.
The release also highlighted some other notable numbers. Freddie Mac:
· Generated nearly $1.2 billion in total comprehensive income through the first three quarters. (Fourth quarter 2014 earnings data has not yet been released).
· Executed 21 multifamily securities offerings in 2014 for a total transactions volume of $22.4 billion which, in addition to K-Deals, included a small volume of other securities, including the company’s Q- and M-Deals.
· Issued $21.3 billion in K-Deals in 2014 and securitized almost $93 billion in multifamily loans since the program started in 2009, backing approximately $79 billion in guaranteed certificates and almost $14 billion in unguaranteed certificates.
· Settled roughly $2.7 billion in targeted affordable housing business of which approximately $1.4 billion were multifamily bond credit enhancements and Tax-Exempt Bond Securitizations (TEBS).