Search
 

Experts Debate Impact of GSE News

A handful of observers examine the conservatorship of the GSEs and what kind of an effect it will have on the multifamily market.

By Sule Aygoren Carranza | Updated on September 22, 2008

[IMGCAP(1)]WASHINGTON, DC-The turmoil on Wall Street, rising operating expenses, escalating job losses and the sagging economy are weighing heavily on the minds of many in the commercial real estate arena. But for those in the multifamily sector–where job growth, consumer confidence and the mortgage market have a direct correlation to demand–those issues have become hot-button topics in recent weeks.

At the National Multi Housing Council’s Apartment Strategies Update, a handful of apartment industry experts got together recently to go over the current state of the market, the factors weighing heavily against it and where they believe the sector is headed.First and foremost is the issue of the government-sponsored entities. After a glut of financial woes, federal officials took over conservatorship of Fannie Mae and Freddie Mac.

Doug Bibby, president of NMHC, characterized the GSE bailout as “a hybrid between the Continental Bank and Chrysler-type approach;” that is, somewhere between nationalization and giving the firms an equity infusion. “Secretary Paulson I believe was more concerned with the worldwide stability issues, particularly Asian holdings of MBS and agency debt,” he related. “There’s also a lot of political undercurrent in just putting an equity infusion into the companies as they’re structured. The conservatorship approach is kind of like being in Chapter 11 versus being in Chapter 7.”

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.