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ORLANDO, FL -- Fannie Mae (FNM/NYSE) today announced that the company, through its lender and housing partners, participated in financing $25.6 billion in multifamily rental housing in 2005, the second best year of investment for the company. Fannie Mae's multifamily financing solutions include debt financing through lender partners and investments in Low Income Housing Tax Credits (LIHTC) through syndication partners.
Production of small loans, defined as loans of up to $3 million or as high as $5 million in certain areas, increased 53 percent over 2004 to $5.2 billion. Multifamily Affordable Housing, which provides financing for rent-restricted properties for people earning 60 percent or less of median income, invested $3 billion in 2005. Production includes bond credit enhancements.
"Fannie Mae worked closely with its lenders and housing partners in 2005 to improve delegation and enhance the products that help us deliver financing to the markets that need it most," said Richard Lawch, Fannie Mae's senior vice president of Multifamily Lending & Investment. "The shortage of affordable rental housing in high-cost areas is an ever-increasing issue, and Fannie Mae and its partners stand ready with the financing solutions to help address it."
More than 90 percent of the units financed by Fannie Mae in 2005 are affordable to families at or below the median income of their communities. Approximately 59 percent of all multifamily units financed by Fannie Mae were reserved for special affordable (low- and very-low income units), and nearly 62 percent of all loans were made in underserved markets and areas. Fannie Mae committed a record $1.8 billion in equity investments that qualify for LIHTC, maintaining its position as the largest investor in LIHTC.
Other highlights of 2005 production include*:
Total DUSTM product: $15.8 billion, which may include some of the following specialty production:
Bond Credit Enhancement: $2.1 billion;
Forward Commitments: $1.6 billion;
Credit Facilities: $1.6 billion;
Large Loans ($25 million or greater): $5.1 billion;
Seasoned Pools: $4.1 billion;
Seniors Housing: $1.7 billion;
Manufactured Housing Communities: $414.6 million; and
Adjustable Rate Mortgages and Discount Mortgage Backed Securities: $1.4 billion.
Fannie Mae Delegated Underwriting & Servicing (DUSTM) lenders delivered $19 billion of the total multifamily financing issued in 2005. An additional $1.9 billion in debt financing was generated by MFlex® lenders, who typically finance small multifamily developments.
Fannie Mae continued
to enhance products to meet changing market
needs. RCG Longview, a New York City-based
real estate opportunity fund manager, and
Fannie Mae made available Fannie Mae's DUS
PlusTM product, which allows
lenders the flexibility to offer additional
mezzanine financing in conjunction with
conventional Fannie Mae fixed-rate DUS loans
which are between $3 million and $25 million.
On the affordable front, Fannie Mae made
available the Unfunded Forward Rate Lock
Commitment. This option enables borrowers
to lock the interest rate and establish
other key provisions of the permanent mortgage
up to 24 months in advance of completing
construction or substantial renovation of
properties designated by state housing finance
agencies as eligible for "9 percent LIHTCs."
In addition, Fannie Mae's multifamily assets, consisting of multifamily mortgages purchased for cash, multifamily Mortgage-Backed Securities (MBS), investments in LIHTC, and other assets, now total over $124 billion.
*Some specialty production numbers may also be included in other specialty numbers. For example, an affordable Large Loan may also be a part of the overall Multifamily Affordable Housing number.
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