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How Big is Small Cap Multifamily?

A closer look at the multifamily housing inventory in the United States and the size of the small cap investment opportunity.

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Multifamily Forecast: Investors Moving to Secondary Markets

The apartment sector has remained the darling of the commercial real estate for the past six years. This doesn’t appear to be changing anytime soon, as 2016 is expected to set a new record for multifamily mortgage origination volume. While multifamily’s position as top dog remains uncontested, savvy investors are altering their strategy for sourcing Read the full article…

GENERAL: 800.ARBOR.10

ESG at Arbor

The history and culture of Arbor Realty Trust, Inc. provides a solid foundation for our ESG framework. Our origin is that of a small company, with an entrepreneurial spirit and meaningful partnerships with those who align with our investing goals and strategy. While we have grown significantly over the last twenty years, we have retained that core spirit, which has attracted and allowed us to retain a talented and diverse employee base and continuously reaffirm our commitment to a number of programs that support ESG, including affordable housing across the United States.

 

It is indeed the relationships with our employees, counterparties, and clients, that inform our business decisions as we move forward, and enable us to clearly see the path to our goals of contributing to sustainability, being profitable, and maximizing shareholder value.

 

Arbor strives to maintain these fundamental constructs that have brought us great success, while realizing those areas in which we can continue to grow and develop as an exemplary corporate citizen.

 

Our dedication to corporate social responsibility and sustainability is clearly evidenced through some of our recent initiatives.

 

Arbors Policy Statement

 

ESG Report

Environmental

Arbor remains committed to the responsible environmental management of our operations. We are consistently working to improve the ways in which we can minimize the impact that our business has on the environment. This exploration involves an analysis of our workspaces and business practices, our vendor and counterparty practices, and the carbon footprint of our lending practices. We believe that the key to keeping our focus on sustainability is continuous and broad-based education and a flexible approach to our policies and processes.

 

Partnerships: Arbor has launched a domestic and international tree planting program, aimed at supporting two highly successful reforestation efforts through a commitment to plant a tree on behalf of Arbor’s customers for each loan we close. This provides a valuable opportunity to connect with our clients while actively contributing to a critically important environmental cause. To date, in recognition of the closing of 1,100 transactions, Arbor has financed the planting of 550 trees domestically and 550 trees in the State of Israel.

 

Energy Management: In its workspaces across the United States, Arbor has installed low-flow water systems in bathrooms, energy efficient LED lighting, daylight and occupancy sensors in all new office buildouts and retrofits, and hands-free faucets. All equipment is set to energy reduction modes, including computer and copier equipment, allowing for “rest” during non-peak hours and double-sided copying is encouraged. Arbor shows preference to green leased buildings for one-off offices and purchases energy star appliances, when available.

 

Waste Management: Arbor maintains effective recycling processes (supplies, electronics, paper files), where available, to increase landfill diversion, and to be in compliance with all building rules and regulations.

 

Carbon Footprint: Arbor currently has a robust telecommuting policy greatly reducing our employees’ use of fossil fuels, supports video conferencing and conference calling as an alternative to travel, utilizes e-signature and electronic invoices and statements, and encourages digital-only subscriptions and eco-friendly packaging solutions.

 

Legal Compliance: Arbor is in full compliance with environmental regulations in all of its office locations and requires the same of the properties on which it lends.

Social

Lending Practices: Affordable housing and the extension of financing to customers investing in affordable housing is not a new concept for Arbor. In fact, Arbor has, for more than two decades, funded affordable loans and has the expertise required to execute across a variety of lending platforms and programs. Arbor was also an early and active participant in our agency partner’s, Fannie Mae and Freddie Mac, “green” lending programs which require willing borrowers to make improvements to their properties that help reduce the energy and water consumption and lower utility costs to tenants. In 2020 and 2021, Arbor sold over $1.4 billion in green-qualified loans to the agencies.

 

Our participation in these market segments is best evidenced through the business we closed through our agency lending partnerships. The chart below demonstrates clearly that Arbor is not only committed to affordable lending initiatives as an organization, with FHFA-defined mission-driven fundings exceeding 54% and 70% of our agency volume in 2020 and 2021, respectively, but a leader in the space, as compared to our peers and all other agency lenders. In addition to mission-driven business, we also supported affordable housing by lending on multifamily assets catering to renters with very low incomes, defined as units lent to renters with income at or lower than 50% of Area Median Income (AMI). In each of the past two years, over 20% of the units we financed fit that criteria.

 

Employee Diversity, Inclusion and Equal Opportunity: We are committed to attracting and retaining top talent with the understanding that a diverse and inclusive workforce provides us with a better business perspective. We consider all qualified applicants for job openings and promotions without regard to race, color, religion, gender, sexual orientation, gender identity, national origin or ancestry, age, disability, service in the armed forces, or any other characteristic that does not bear on the ability of employees to do their jobs well.

 

Our people remain at the core of who we are and how we define ourselves, and so we are proud to have partnered with two organizations to actively support the recruitment, development, and retention of diverse professionals across our organization.

 

Arbor has established a partnership with Project Destined (“PD”), a real estate finance focused internship program, providing minority college students with the ability to gain and finetune technical, financial and leadership skills and which, as a by-product, gives us the opportunity to source additional diverse talent. Six talented Arbor employees, representing several different areas of our business, will be representing Arbor as mentors in PD’s Summer 2022 session.

 

Arbor continues to participate with Future Housing Leaders (“FHL”), which is a Fannie Mae-led recruiting service that helps companies create a more diverse workforce through intentional sourcing and recruiting.

 

We look forward to nurturing and evolving these partnerships over time, helping to shape future leaders from a variety of backgrounds, with the active participation of our existing employees and the support of management.

 

Arbor also encourages its employees to support industry-focused organizations and committees that are committed to creating, launching, and managing DEI initiatives within our space. Such organizations include Commercial Real Estate Women Network (CREW) and the CRE Finance Council (CREFC) Women’s Network.

 

We plan to continue developing initiatives and supporting organizations that ultimately further espouse our DEI goals and values.

 

Charitable Organizations and Volunteerism: Arbor actively encourages its employees to support the communities in which we live and operate. In 2021, Arbor and its employees supported local food banks and clothing drives, hospitals and medical research, and community-based organizations focused on the welfare of families and children.

 

We actively encourage volunteerism and philanthropy amongst our employees, and we proudly support our clients and counterparties in their charitable efforts.

Governance

Our independent directors are a diverse group and Arbor remains committed to maintaining a dynamic mix of people and ideas. We wholeheartedly believe that this commitment allows us to continue to improve the performance of our business, the experience of our employees and customers, and the state of our communities. Details regarding our directors are available here:

Female Male Non-Binary Did Not Disclose Gender
Part I: Gender Identity
Directors 1 8
Part II: Demographic Background
African American or Black 1
Alaskan Native or Native American
Asian
Hispanic or Latinx
Native Hawaiian or Pacific Islander
White 8
Two or More Races or Ethnicities
LGBTQ+
Did Not Disclose Demographic Background

 

Lastly, we have embedded our commitment to ESG throughout our governance structure. Our Statement of ESG Principles guides our ESG and our broader initiatives and our Board of Directors, primarily thorough its Corporate Governance Committee, oversees our efforts. We also have included the spirit of our Statement of ESG Principles through relevant policies and procedures of the Company.