Multifamily Deals Multiply

Fannie and Freddie Provide Plentiful, Affordable Capital

By JONATHAN KARPApril 9, 2008; Page C13

As the pace of commercial real-estate sales grinds almost to a halt amid financial-market instability and concerns about property values, deal activity is still brisk in one corner of the industry: multifamily housing.

Fueling the deals and buoying apartment values is the rare availability of financing, thanks to government-sponsored Fannie Mae and Freddie Mac. Prompted by their mandate to provide market liquidity and funding for affordable housing, but also driven by a fresh opportunity for profit, both firms are expanding in the multifamily market to fill a vacuum left by private lenders.

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Tough Times for Apartment Investors

By Ben Johnson
Jan 1, 2008 12:00 PM

A long shadow hangs over the U.S. apartment market at the start of 2008. The combination of a potential supply glut fueled by a growing number of condominiums and single-family homes available for rent and the ongoing subprime mortgage crisis threatens the health of the sector.

The upshot? Some markets are bound to fare better than others. “There is a real divergence taking place right now in the apartment market between winners and losers,” says Michael Cohen, research strategist and head of multifamily research at Boston-based Property & Portfolio Research (PPR).

“Market selection for apartment investors is really very important at this point in time because there are some markets that are very clearly going to become laggards going forward over the next couple of years,” adds Cohen.

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