Some of the first 2012 deals done through some of the agencies' more recently added multifamily programs are hitting the market and so far it looks like another strong year for these types of bonds.
“This is our largest market driven deal yet,” said Kimberly Johnson, vice president of multifamily capital markets, commenting on a $763 million multifamily DUS REMIC that recently priced and marked the first transaction of its kind this year. “We had a few new investors coming in and we're pleased that the program continues to grow.”
The deal was about 50% larger than most of deals done last year and priced as expected, she said in an interview. Johnson added that having such a successful execution for a larger deal size encourages larger sizing in the future.
The deal, FNA 2012-M1, has among other things yield maintenance prepayment premiums on all underlying loans; geographic concentrations in California (27%), Texas (16%), and New York (12%); and a weighted average loan-to-value ratio of 65.04%.
Credit Suisse was the lead manager. J.P. Morgan and Wells Fargo were co-managers.
Also Freddie Mac said Tuesday that this week it plans to issue its first “K” deal of the year and the fifth deal of this type it has done backed exclusively by multifamily mortgages with a seven-year term.
Mitch Resnick, co-head of Multifamily Capital Markets for Freddie Mac, said in a press release that Freddie in 2012 expects to issue at least as many K-deals as it did in 2011, when it did 12 representing almost $14 billion in securities.
A syndicate of dealers led by Credit Suisse Securities (USA) LLC and Merrill Lynch, Pierce, Fenner & Smith Inc. as co-lead managers and joint bookrunners for the transaction are offering this week's Freddie Mac K deal to the market with an estimated $1 billion deal size. Barclays Capital Inc., CastleOak Securities LP, Jefferies & Co. Inc., and J.P. Morgan Securities LLC are serving as co-managers for the transaction.
The K-705 certificates are backed by 70 recently originated multifamily mortgages.
