Freddie Mac Single-Sponsor Execution

Freddie Mac Single-Sponsor Financing  

Smart investors and developers understand that the largest multifamily properties and portfolios often need the most flexible financing terms, and fortunately, Freddie Mac agrees.

Freddie Mac's Single-Sponsor Execution is specifically designed to finance large multifamily properties and portfolios of $250 million and more, and with up to 30 year fixed-rate and up to 10-year floating-rate loan terms, non-recourse execution, and highly competitive interest rates, you'd be hard pressed to find a better option on the market. Plus, Freddie Mac's Single-Sponsor Execution is available for all property types, including Conventional properties, Seniors Housing Developments, Student Housing properties, Targeted Affordable Housing, and Manufactured Housing Communities, and supports eligible mixed-use properties. 

Sample Freddie Mac Terms for Single-Sponsor Execution in 2024

Size:  $250 million or more for one or more properties 

Use:  Financing one or more large multifamily properties 

Terms:  Up to 30 years for fixed-rate loans, up to 10 years for floating-rate loans, or some combination of both. Partial and full term interest-only loans also available. 

Interest Rates:  Fixed-rates based on U.S. Treasury Securities, floating-rates based on the 1-month LIBOR

Maximum LTV/Minimum DSCR:  Varies

Recourse:  Non-recourse with standard “bad boy” carve-outs

Cross-Collateralization:  Borrowers can decide whether to use collateralized or uncrossed loans. individual property loans can be released from cross-collateralization as long as the remaining pool of loans still meets LTV/DSCR requirements. 

Eligible Properties: 

All major property types are eligible, including: 

• Conventional

• Seniors Housing

• Student Housing

• Targeted Affordable Housing

• Manufactured Housing Communities

Assumability:  Uncrossed pools of properties are typically assumable. collateralized pools may be approved for assumption on a individual basis (typically restricted to transactions where the Sponsor purchases the B-piece.)

Advantages:

• Very competitive interest rates

• Supplemental loans permitted

• All property classes are permitted

• Eligible mixed-use properties are supported

• Early rate locks available, typically lasting around 60-120 days before purchase, index locks and standard delivery are also available

• Optional Sponsor B-piece purchase allows for maturity laddering, substitution rights, and a lower effective pay rate

Disadvantages:

• Replacement reserves are generally required