Articles

Video: Special Report Fall 2023 Key Takeaways

In this video, Dr. Sam Chandan, Founding Director of the C.H. Chen Institute for Global Real Estate Finance at the NYU Stern School of Business and non-executive chairman of Chandan Economics, details the key takeaways of Arbor’s Special Report Fall 2023, which he co-authored with Ivan Kaufman, Chairman and CEO of Arbor Realty Trust.

Articles

FHFA Loan Caps for 2024: What Multifamily Borrowers Need to Know

The Federal Housing Finance Agency (FHFA) announced a $10 billion rollback of Fannie Mae and Freddie Mac’s volume cap for loan purchases for 2023 to $140 billion ($70 billion for each agency). This move aligns with industry expectations, given the anticipation of continued headwinds for the multifamily in 2024. Next year’s cap for the Government-Sponsored Entities (GSEs) is a reduction of approximately 7% from the $150 billion limit set for 2023 and a return to the level it was in 2021.

Current Reports

Affordable Housing Trends Report Fall 2023

With the cost of living climbing, the need for affordable housing has become more urgent. Although demand continues to outpace available supply, multifamily investment in affordable housing is fortified by Low-Income Housing Tax Credits (LIHTC), Project-Based Section 8, and the Housing Choice Voucher (HCV) programs. Arbor’s Affordable Housing Trends Report Fall 2023, developed in partnership with Chandan Economics, examines the supply-driven programs and policies designed to improve supply at a point in time when federal gridlock has stalled many funding increases.

Current Reports

Small Multifamily Investment Trends Report Q4 2023

Arbor’s Small Multifamily Investment Trends Report Q4 2023, developed in partnership with Chandan Economics, is a snapshot of a strong and resilient subsector continuing to navigate ongoing market dislocation. The report shows that distress has remained limited, even with valuations and measures of risk pricing in flux. As conditions start to stabilize, there are signs that deal activity is picking up.

Analysis

U.S. Multifamily Market Snapshot — Q3 2023

The U.S. multifamily market held steady during the third quarter of 2023, as high mortgage rates and a lack of inventory in the housing market continued to drive rental demand.

GENERAL: 800.ARBOR.10

FANNIE MAE DUS®

Near-Stabilization Execution

Arbor provides Fannie Mae’s Multifamily Mortgage Business permanent mortgage loan financing for newly constructed or recently renovated conventional and affordable multifamily apartment communities expected to achieve stabilized occupancy within 120 days.

Loan Amount $10M smaller loan amounts may be considered
Loan Term 5-, 7-, 10- and 12-year term options available
Amortization 5 – 30 years
Minimum DSCR Targeted underwritten DSCR of 1.25x (Up to 1.15 for MAH loans). Underwritten DSCR is defined as DSCR as deemed achievable within 4 months after rate lock by the Lender and by Fannie Mae in its sole discretion
Maximum LTV 75% of “as stabilized” loan-to-value
Rate Structure Fixed- and variable-rate interest options are available
Eligible Properties Partially leased, newly constructed, or recently renovated conventional and affordable housing properties, which are 100% complete and expected to obtain stabilized occupancy within 120 days of rate lock
Eligible Borrower Strong borrower with demonstrated lease-up track record
Occupancy Requirement 75% physical occupancy
Tax & Insurance Escrows Monthly deposits required. May be waived if certain criteria are met.
Replacement Reserves Underwritten at a minimum $250 per unit per annum
Recourse Non-recourse execution with standard carve-outs for “bad acts” such as fraud and bankruptcy
Commercial Space Maximum 35% of net rentable area and maximum 20% of effective gross income
Required Reports Appraisal, Property Condition Assessment, Phase I Environmental
Prepayment Flexible prepayment options available, including yield maintenance and declining prepayment premium
Assumable Subject to approval and 1% fee
Supplemental Loans Eligible for secondary financing after 12 months
Pricing Tiered Pricing Matrix. More favorable terms available for higher DSC and lower LTV.
Rate Lock 30- to 120-day commitments; Borrowers may lock a rate with the Streamlined Rate Lock option
Accrual 30/360 and Actual/360
Application Deposit $20,500. Covers estimated processing and legal fees
Origination Fee Minimum 1.00%
Good Faith Deposit 2% of loan amount, due at rate lock, refundable post-closing

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