LOS ANGELES – December 11, 2017 – Berkadia today announced that it was approved as the first Freddie Mac Seller/Servicer to obtain the National Single-Family Rental Designation by Freddie Mac Multifamily. This approval permits Berkadia to sell and service loans secured by single-family rental properties nationwide to Freddie Mac.
“The entrance of Freddie Mac into the single-family rental space is an exciting development for both borrowers and tenants,” said Managing Director Anthony Cinquini, who is leading Berkadia’s foray into the space. “As the sector grows and becomes more standardized, Berkadia will employ industry best practices during the life of the loan in terms of asset quality and conditions. Our deep knowledge of the multifamily industry will ensure the quality of the home meets acceptable standards set forth by Freddie Mac. Ultimately, this should benefit the affordable housing community by increasing the rehabilitation of ‘low value’ homes by experienced borrowers that are incentivized to maintain the asset quality.”
The single-family rental sector has been growing steadily since the Great Recession. In 2016, 36.6 percent of households were renting their homes, up from 31.2 percent in 2006, according to the Pew Research Center. Currently, institutional ownership accounts for approximately 2 percent of single-family rental inventory, but increasing institutional interest has created a need for a national lending platform.
“Freddie Mac’s single-family rental pilot is designed to enhance our efforts to bring liquidity, stability and affordability to the rental market, and Berkadia will be an important partner in that work,” said David D. Leopold, vice president of targeted affordable sales & investments at Freddie Mac Multifamily. “We are delighted to be working with Berkadia in this new capacity and look forward to expanding affordable housing options for low-income and working families.”
“This is a new asset class for Freddie Mac and a relatively new asset class for the industry,” continued Cinquini. “We’ve been working very closely with our partners at Freddie Mac to think through all the complexities in the creation of this new product, tapping into our market knowledge and leveraging our national presence in order to enhance Freddie Mac’s efforts to expand this lending platform. We’re excited to continue to work with Freddie Mac to provide innovative and essential products in the single-family rental housing market.”
In 2016, Berkadia’s loan origination volume was $20 billion, ranking first with U.S. Department of Housing and Urban Development, second with Freddie Mac and fourth with Fannie Mae in delivered loan volume.