Mike May, who led Freddie Mac’s multifamily division since 2006, has resigned from the company and will officially vacate his post July 15.
David Brickman, Freddie Mac’s former head of multifamily CMBS, has been tapped to replace May in the leadership role. Brickman’s official title is now senior vice president and head of multifamily.
The resignation underscores an ongoing managerial “brain drain” at the government-sponsored enterprises (GSEs) as they remain in organizational limbo, facing an uncertain future.
Last year, Freddie Mac lost Mitch Kiffe, an 18-year company veteran who led its multifamily loan production department. And in September 2009, Fannie Mae lost its head of multifamily when Phil Weber, a 19-year Fannie Mae veteran, left to join Austin, Texas-based developer Forestar Group.
“It’s not only the brain drain aspect that’s an issue. It’s the climate, the working environment and keeping people engaged and motivated,” said Kiffe, now co-head of origination at Los Angeles-based CB Richard Ellis Capital Markets, when asked about it in April. “It’s a tough environment. The GSEs have been vilified by various constituencies for years now, and that's unpleasant. And along with the uncertain future, those things weigh on people.”
The fear from many in the industry is that the companies will increasingly lose valuable human capital as Congress fiddles with GSE reform. And since the GSEs continue to dominate the market—accounting for more than 60 percent of all multifamily permanent debt last year—their staffing issues affect the industry at large.
Many are now calling on Congress to come up with a solution sooner rather than later to limit any disruption. “We can’t just suddenly end the GSEs, but we also can’t say ‘Let’s keep thinking about it,’” says Shekar Narasimhan, managing partner at Washington, D.C.-based Beekman Advisors. “The bottom line is that it won’t hang together. People don’t wait around in dying places, don’t hang around a funeral home after a funeral.”