Single-Family Rental Investment Trends Report Q1 2023

Investor Purchases, New Starts, and Tenant Performance Show Strength as Cap Rates Rise Arbor’s Single-Family Rental Investment Trends Report Q1 2023, developed in partnership with Chandan Economics, explores a growing multifamily sector with a unique ability to rise above macroeconomic headwinds.   Last year, investors purchased more single-family rental (SFR) units than in 2021 as Read the full article…

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Affordable Housing Market Snapshot — Spring 2023

Arbor’s latest Affordable Housing Trends Report, developed in partnership with Chandan Economics, offers a wide-ranging lens into the complex, though critically important, affordable and workforce housing sectors.

Articles

Seven Facts about FHA Multifamily Loans for Affordable Housing

The Federal Housing Administration (FHA), a part of the U.S. Department of Housing and Urban Development (HUD), is one of the largest mortgage insurers in the world. The agency insures mortgages on affordable housing, multifamily properties, single-family homes, multifamily properties, and health care facilities. Since 1934, FHA has financed over 50,000 multifamily mortgages nationwide. Whether you’re interested in acquiring, refinancing, or rehabilitating an affordable housing property, FHA multifamily loans are a financing route you need to know about.

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Video Analysis: Arbor’s Affordable Housing Trends Report Spring 2023

In this video, Sam Chandan, professor of finance and Director of the Chen Institute for Global Real Estate Finance at the NYU Stern School of Business, discusses the key findings of Arbor’s Affordable Housing Trends Report Spring 2023, developed in partnership with Chandan Economics. He adds context to the Federal, state, and local housing policy trends impacting the future of the affordable sector, which, he notes, continues to have the highest development prospects of any residential subtype.

Current Reports

Small Multifamily Investment Trends Report Q1 2023

The small multifamily subsector, strengthened by sound structural fundamentals, is well-positioned to face distress due to interest-rate pressure. Even though pricing has slid lower and cap rates have risen, it should remain resilient in the coming quarters. A deep dive into a uniquely positioned subsector, Arbor’s Small Multifamily Investment Trends Report Q1 2023, developed in partnership with Chandan Economics, analyzes the competing headwinds and tailwinds influencing investment performance.

Articles

Arbor Wins Prestigious Fannie Mae Excellence in Technology Award

Fannie Mae Multifamily recently honored Arbor with its prestigious 2022 DUS Lender Award for Excellence in Technology, citing it as “a constant source of innovative ideas” and “a stalwart partner” in driving “Fannie Mae’s digital transformation for the DUS community.”

Analysis

U.S. Multifamily Market Snapshot — Q1 2023

The U.S. multifamily market continued to show signs of slowing during the first quarter of 2023. Rent growth was down from the skyrocketing pace seen in 2021 and 2022, although demand remained strong and vacancy held near historic lows.

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Home | Fannie Mae | Fannie Mae Seniors Housing
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FANNIE MAE DUS®

Seniors Housing

Arbor’s Seniors Housing provides financing options for properties that provide Independent Living (IL), Assisted Living (AL), Alzheimer’s/Dementia Care (ALZ), or any combination.

Loan Amount Minimum $5M, with exceptions on a case-by-case basis
Loan Term 5 to 30 years
Amortization Up to 30 years
Minimum DSCR
  • 1.30x if the property is 100% Independent Living/li>
  • 1.40x for properties with an assisted living and/or Alzheimer’s component greater than 50%
  • 1.45x if the property is stand-alone Alzheimer’s/Dementia Care
  • 1.50x if the property contains skilled nursing units

For combinations of IL, AL, and ALZ, special rules apply to calculate minimum DSCR.
Maximum LTV 75% (80% for fixed-rate, tax-exempt bonds)
Rate Structure Fixed- and adjustable-rate options available
Eligible Properties
  • Independent Living properties
  • Assisted Living properties
  • Alzheimer’s/Dementia Care
  • Newly constructed and stabilized Seniors Housing facilities, as well as campuses containing skilled nursing beds on a case-by-case basis
Eligible Borrower Single Asset Entity. Owners and operators must have a minimum of five years experience in Seniors Housing, owning and/or managing a minimum of five stabilized properties
Property Requirement All properties must have a fully operational separate category sprinkler system in all units and in common areas and may not charge entrance fees. Typical community fees are allowed
Occupancy Requirement At least 90% occupied for each of the past five fiscal years
Tax & Insurance Escrows Fully funded replacement reserve, tax and insurance escrows are required
Replacement Reserves Underwritten at a minimum $300 per unit per annum.
Recourse Non-recourse execution is available, with standard carve-outs required for “bad acts” such as fraud, bankruptcy and illegal transfers
Commercial Space Maximum 10% of net rentable area and 10% of effective gross income.
Required Reports Appraisal, Property Condition Assessment, Phase I Environmental, Zoning, Termite, Flood and Seismic Report (for properties in Seismic Zones 3 and 4).
Management and operations reports are required for all Seniors Housing Properties.
Licensed seniors housing properties also require a Seniors Housing Liability Assessment Report.
Prepayment Yield maintenance, defeasance, and graduated prepayment premium
Assumable Loans may be assumable, subject to review and approval by the Lender and Fannie Mae of the proposed new borrower’s financial capacity and experience. 1% assumption fee
Subordinate Financing Not allowed
Supplemental Financing Supplemental Loans are available
Pricing Risk based pricing; more favorable pricing available for higher DSC and lower LTV
Rate Lock 30- to 180-day commitments; the early rate lock option is available with prior approval from Fannie Mae, allowing the borrower to lock a rate after the lender completes preliminary underwriting; extended rate lock feature is also available, allowing the borrower to lock a rate 45 to 365 days in advance of closing
Application Deposit $20,500; covers estimated processing and legal fees
Origination Fee 1% of loan amount
Good Faith Deposit 2% of loan amount, due at rate lock, refundable post-closing

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