As we enter another heated election season, perhaps no single issue touches as many multifamily players as housing finance reform.

Multifamily Executive recently sat down with Shekar Narasimhan, managing partner of McLean, Va.–based Beekman Advisors, to discuss that topic, as well as several others. Narasimhan has a deep history with Fannie and Freddie—he was CEO of WMF Group, a large agency lender which was acquired by Prudential in 2000. Narasimhan was elected the first chair of the DUS Advisory Committee, founded the MBA's Multifamily Steering Committee and was the first chair of its Multifamily Board of Governors. He also sits on the executive committee of the National Housing Conference, and is a fellow at the Joint Center for Housing Studies at Harvard University.

Here, he predicts how things might shake out once the dust settles and a decision maker has been chosen to steer the fate of the housing industry for the next four years—and beyond.

MFE: What are the possibilities of Freddie Mac and Fannie Mae spinning off their multifamily divisions into standalone companies?
Narasimhan: I think there’s a 20 percent possibility. I am an advocate of these as standalone businesses and I think it is viable. But the difficulty is, in my view, that you need to have a government backstop in place for the securities they are issuing. You want the government footprint to be as minimal as possible while maintaining the ability for them to step in, in situations when it's needed. But I think they could both generate significant returns.

MFE: What is the latest on the white paper to be issued on that subject?
Narasimhan: The Treasury just released a statement which essentially tells us that it’s still going down the same road it has been while addressing the long term and creating a time frame. The Treasury is saying, “Forget the 10 percent dividend we’ve been collecting; we don’t need to do that anymore. We’ll take all the profit.” By accelerating the wind-down, it’s making it clear that it isn’t trying to build small businesses here.

MFE: Where does the FHA fit into the housing finance reform debate?
: I think it’s a big part of the debate even though it can’t be a huge part of the market, because of its very closed process. It’s limited by itself, which is okay. We want it to be available so that it’s responsive, but it can’t be much more than it is the way it is structured.

MFE: How do you think the upcoming election will affect the housing finance reform debate?
In my view, if Obama is re-elected, odds are we are in for a period where the focus is going to be on the deficit and the debt ceiling. There won’t be a lot done with the GSEs until next year though. Probably beginning around mid-year. They’ve been here for four years. They’ve figured things out. But a new Secretary of Treasury could change things. If Romney is elected, I think the debate becomes ‘do we want these entities at all?’ There’s more uncertainty with a Romney election. In either case, nothing is likely to happen until 2014. I expect it to be about a four-year window for things to happen.

MFE: Do you think government guarantees will still be made available to Freddie and Fannie?
Absolutely. They have to be. I expect Freddie and Fannie represent as much as much as 65 percent of all loans. And if you include FHA, it’s more like 75 percent. Single-family is closer to 80 percent. I can’t imagine anyone coming in and yanking out the guarantees out from under them.