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Ryan Haase

This fall, several events related to Fannie Mae and Freddie Mac occurred that cumulatively made them less competitive in multifamily lending and created uncertainty around the GSEs moving forward. Since then, banks, life companies, and conduit lenders are fighting tooth-and-nail to recapture multifamily financing market share in light of the resultant agency void.

Fannie Mae and Freddie Mac announced in late August that they had reached their target loan production allocations for 2019. As a result, agency loan production came to a screeching halt, with the few ongoing transactions being executed at far more conservative levels and on a much more selective basis. Quoted spreads widened approximately 70 basis points, leverage levels decreased, and waivers were halted, effectively stalling production and making quotes much less attractive to commercial real estate borrowers.

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