LOS ANGELES – January 9, 2018 – Berkadia today announced it has closed the very first Affordable Single Family Rental financing through Freddie Mac Multifamily for TrueLane Homes, a leading owner of single-family rental homes.
The financing was in the amount of $11,092,000 for a ten-year, fixed-rate loan secured by 195 homes and one duplex in nine different metropolitan areas across six states. Over 90 percent of the homes have rents that are considered affordable for families earning at or below 80 percent of the median income (AMI). Moreover, 100 percent of the units are affordable for families earning at or below 100 percent AMI.
“The single-family rental space has a gap in liquidity and affordability, which Freddie Mac is well-positioned to fill as evidenced by this transaction,” stated Anthony Cinquini, managing director at Berkadia. “We’ve been working closely with our partners at Freddie Mac to devise a lending platform that applies the discipline of our multifamily lending standards to single-family home rentals. This includes detailed and thorough underwriting of the borrowers and homes at origination and throughout the term of the loan, which promotes the long-term sustainability of the rental homes.”
“We’ve said from the beginning that the goal of our single-family rental pilot is to increase the availability of affordable rental housing in communities across the country, and this transaction does exactly that,” said David Leopold, vice president Targeted Affordable Sales & Investments at Freddie Mac Multifamily. “All of the homes in this transaction will remain affordable for working families, with over 90 percent affordable for low- and very-low income families. We thank our strong partners at Berkadia for working constructively with us to bring even more affordable housing to those families that need it. We look forward to continuing to use our unique position in the market to drive financing towards greater affordability in the single-family rental market.”
“The Freddie Mac and Berkadia single-family rental platform will continue to evolve as we find more opportunities to finance single-family rentals toward the goal of providing clean and safe affordable rental housing across the nation,” continued Mr. Cinquini. “We’re excited for what the future holds.”
Berkadia was the first Freddie Mac Seller/Servicer to obtain the National Single Family Rental Designation by Freddie Mac Multifamily, permitting the organization to sell and service loans secured by single-family rental properties nationwide to Freddie Mac. This was the first transaction of this kind for Berkadia and Freddie Mac.
Alan True, founder and CEO of TrueLane Homes, said, “When we began the conversations with Freddie Mac and Berkadia, it was clear our strategies for providing quality affordable rental homes were aligned. We are pleased this transaction was executed on time and on budget.”
“We support the local community by investing capital to rehabilitate affordable single-family rental homes in working-class markets. From our corporate headquarters to our local property managers, our goal is to provide quality affordable housing in our markets by being attentive to the needs of our tenants,” continued Mr. True. “The deep knowledge of affordable housing at Freddie Mac and Berkadia and their mission to encourage borrowers like us to continue to provide housing to working-class individuals will impact the industry for years to come.”
Hunton & Williams LLP served as legal counsel to Berkadia and Freddie Mac for the transaction.