Articles

How Multifamily Property Renovations Add Value and Marketability

The ideal time to renovate is when the rental market is strong. With high occupancy rates, borrowers are more likely to quickly realize returns on their multifamily property renovations through higher rents. However, renovating during a market downturn, when rents are often cheaper, inventory is higher, and materials are more affordable, is also a sound strategy.

Current Reports

Single-Family Rental Investment Trends Report Q2 2024

Quarter after quarter, the single-family rental (SFR) sector reaches new heights. From new construction to cap rates, Arbor’s Single-Family Rental Investment Trends Report Q2 2024, developed in partnership with Chandan Economics, details how the sector’s healthy fundamentals create profound optimism in its long-term prospects.

Articles

Arbor Sponsors Smile Farms Golf Outing Supporting Local Employment Opportunities

Arbor, which takes pride in helping employees reach their full potential, was honored to sponsor and participate in Smile Farms’ 10th Anniversary Golf Outing on May 20 at the Plandome Country Club on Long Island, NY, benefiting the Long Island-based organization dedicated to advancing opportunities for people with disabilities.

Articles

New York State’s 2025 Budget Advances Affordable Housing Goals

In April, New York State Governor Kathy Hochul announced a landmark budget agreement heralded as a giant step for affordable housing. New York’s FY 2025 Enacted Budget includes several key policy changes that could create thousands of affordable housing units across the state.

Articles

SFR East 2024: How Economics and Demographics Shape the Rental Market

IMN’s Single Family Rental Forum (East), the cornerstone gathering of the SFR industry, concluded on May 22, 2024, in Miami, FL. Over three days, 1,800 attendees listened to more than 280 speakers discuss all angles of the SFR industry. On the first day of the conference, Arbor’s Tres Seippel, Director, Construction Management, participated in a wide-ranging panel discussion examining economic and demographic forces influencing SFR and build-to-rent (BTR), which also featured Rick Dalton, President of the Dalton Group, Domonic Purviance of the Federal Reserve Bank of Atlanta, Wade McGuinn, CEO of McGuinn Hybrid Homes, and Heather Williams, VP at Willow Bridge Property Company.

Articles

Affordable Housing Market Snapshot — May 2024

As housing costs spiral, rental affordability has become a more urgent issue, burdening a greater number of Americans. With more funding on the way, policymakers and private market advocates are pressing ahead with plans to add units to an increasingly tight housing market.

General: 800.ARBOR.10

FANNIE MAE DUS®

Manufactured Housing Community Loans

Arbor’s Fannie Mae DUS Manufactured Housing Community (MHC) loans provide competitive pricing and flexible terms and function as a major source of liquidity for affordable housing community owners.

Minumum Loan Amount $750,000
Loan Term 5 to 30 years
Amortization Up to 30 years
Minimum DSCR 1.25x
Maximum LTV 80%
Interest Rate Fixed- and variable-rate options available
Eligible Properties
  • Existing, stabilized, professionally managed MHC, with or without age restriction, having a minimum of 50 pad sites
  • Quality Level 3, 4, or 5 communities
Eligible Borrower Single Asset Entity; At least one Key Principal of the Borrower should have experience in operating MHC
Property Considerations
  • MHC may be either age-restricted or all age (family community)
  • The percentage of tenant-occupied homes generally may not exceed 35%
  • Density is based on market norms and generally should not exceed 12 manufactured homes per acre for an existing community and seven manufactured homes per acre for a new community
  • With limited exceptions, all manufactured homes should conform to applicable Manufactured Housing HUD Code standards
  • Leases with two-year terms or longer cannot contain a tenant option to purchase the pad site
  • Additional pricing incentives available for non-traditional MHC ownership forms (e.g., non-profit, government entity, or resident-owned)
  • Additional pricing incentives available for Borrowers implementing Tenant Site Lease Protections
Escrows Funding of tax and insurance escrows depends on leverage level; Replacement reserve escrow is typically not required
Recourse
  • Nonrecourse execution with standard carve-outs for “bad acts” such as fraud and bankruptcy
  • For loans with the pricing incentive for having minimum Tenant Site Lease protections, a Limited Payment Guaranty for 10% of the Mortgage Loan amount is required
Third-Party Reports Standard third-party reports required, including Appraisal, Property Condition Assessment and Phase I Environmental Site Assessment
Third-Party Reports Cost Reimbursment Fannie Mae will reimburse the cost of third-party reports up to $10,000 for Communities with Tenant Site Lease Protections implemented for at least 50% of the Sites, or if the community is owned by a non-profit entity. Minimum site lease protections must include:

  • One-year renewable lease term for the site unless good cause for nonrenewal
  • 30-day written notice of site rent increases
  • Five-day grace period for site rent payments and right to cure defaults on site rent
  • Rights of tenants to:
    • Sell the manufactured home without having to first relocate it out of the community
    • Sublease the home or assign the site lease to a new buyer, so long as the new buyer meets the minimum MHC rules and regulations and the borrower’s credit standards for new tenants, consistent with the market
    • Post “for sale” signs that comply with the MHC rules and regulations
    • Sell the home in place within 45 days after eviction and receive at least 60 days’ advance notice of any planned sale or closure of the community
Prepayment Availability
  • Flexible prepayment options are available
  • Mortgage loans may be voluntarily prepaid upon payment of yield maintenance for fixed-rate loans or graduated prepayment for variable-rate loans
Assumption Mortgage loans are typically assumable, subject to review and approval of the new borrower’s financial capacity and experience
Supplemental Financing Supplemental Mortgage Loans are available
Rate Lock 30- to 180-day commitments; Borrowers may use the Streamlined Rate Lock option
Accrual 30/360 and Actual/360
Minimum Underwritten Vacancy/Collection Loss Minimum 5% economic vacancy assumption

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