Posted on Tuesday, February 2, 2010
February 01, 2010
Fannie Mae and its DUS® Lenders Invest $19.8 Billion in 2009 to Fortify the Multifamily Rental Housing Market
Fannie Mae remains a constant source of liquidity and stability
WASHINGTON, DC - Fannie Mae (FNM/NYSE) today announced that the company, through its lender and housing partners, provided $19.8 billion in debt financing for the multifamily rental housing market in 2009. Fannie Mae's DUS® lenders and affiliates delivered $18.6 billion of the company's total investment in multifamily housing by utilizing the company's DUS platform. DUS lenders are able to underwrite, close and deliver most loans without pre-review by Fannie Mae, which results in a highly efficient execution.
"Fannie Mae stands ready to partner with lenders and borrowers to provide liquidity and stability, even in the most challenging of market conditions," said Ken Bacon, Executive Vice President of Fannie Mae's Housing & Community Development division. "Congratulations to our DUS lenders for delivering solid results in a multifamily market that was 25 percent smaller than the market in 2008."
Fannie Mae Multifamily made reinvigorating its MBS business and broadening the investor base its top priority in 2009. Approximately 81 percent of total production, or $16 billion, was an MBS execution in 2009, compared to 17 percent, or $5.9 billion, in 2008. Fannie Mae began securitizing DUS loans and created MBS/DUS in the early 1990s, which offers investors Fannie Mae's guaranty of timely payment of principal and interest. By ramping up its MBS execution, Fannie Mae Multifamily is providing liquidity to the multifamily market mainly through MBS issuance.
Approximately 87 percent of the multifamily units financed by Fannie Mae in 2009 were affordable to families at or below the median income of their communities. Approximately 49 percent of all multifamily units financed by Fannie Mae served special affordable families (low- and very-low income families in low-income areas), and 48 percent of the multifamily units financed were made in underserved markets.
Additional highlights of 2009 production include the following specialty production, which is part of the overall total multifamily investment number*:
Large Loans (loans $25 million or higher): $4.4 billion;
Small Loans (loans of up to $3 million, or $5 million in high cost areas): $2.2 billion;
DUS Flow Loans (loans between $3 million and $25 million): $9.4 billion;
Structured Transactions: $3.4 billion;
Multifamily Affordable Housing (MAH), which provides financing for rent-restricted properties for people earning 60 percent or less of median income: $1.1 billion;
Pools: $154 million;
Bond Credit Enhancements: $273 million;
MBS: $16 billion;
DMBS: $196 million;
Manufactured Housing Communities: $1.1 billion;
Seniors Housing: $1 billion.
Fundamentals of the multifamily market are expected to remain under pressure in 2010. As the U.S. economy recovers and excess housing supply begins to decline, Fannie Mae Multifamily will stay focused on providing liquidity and will continue to work with its servicers to ensure properties are maintained as safe, decent and affordable housing.