Fannie Mae Makes Place for Multifamily in Recovery Initiative

WASHINGTON, DC-After focusing for some time on helping the single-family sector in its recovery, Fannie Mae has now turned its attention to the multifamily market. The mortgage giant plans to expand liquidity, stability and affordability by increasing its participating in key segments of the multifamily segment. The locally based firm also announced its multifamily investment total for the first half of the year, $20 billion.

The increased focus on apartments is part of Fannie’s Keys to Recovery initiative, which has so far been serving single-family homeownership. “With the turmoil being what it was, we decided as a company that we would want to do things that are positive steps in trying to help the market recover,” said Jeff Hayward, Fannie’s SVP of community lending and development, in a conference call announcing the initiative. “Our decision was whether to sit back and watch it, or try to do things to help the market move forward.”

As the largest multifamily investor, Fannie’s new focus on the segment will be concentrated in four key areas: small loans up to $3 million, or $5 million in high-cost markets; seniors housing; military housing; and increasing investment in the affordable segment, particularly bond credit enhancement. While those are near-term goals–specifically, for the second half and into 2009–the firm is committed to the apartment sector, says Phil Weber, SVP of multifamily. “Our overall view of the multifamily business is that the fundamentals remain solid,” he relates. “The $20 billion we invested in the first half of the year is, for the most part, in increase across the board in almost all of our business, especially the DUS and small loan business.”