Wells Seen Showing Aggressive Interest in Multifamily

Wells Fargo Home Mortgage is "very aggressively" looking to back multifamily properties, an executive with the Des Moines-based lender said at the Pacific Coast Builders Conference in San Francisco. "We can do just about any kind of deal, but it has to make sense," said Eric Smith, a senior vice president who works out of Wells Fargo's San Francisco office. Smith said lending on income-producing properties has been a "core product" for his company for a dozen years, and the acquisition of Wachovia Bank has made Wells' commitment to multifamily "even stronger." Currently, Smith confided during PCBC's Multifamily Trends day, Wells has a particular appetite for student housing, which Smith called "a pretty good opportunity." With colleges looking to expand by bringing in out-of-state students who pay a higher tuition, he noted, there is "a built-in demand" for apartments on and near many campuses. Freddie Mac also is looking for deals, but Steve Griffin, managing director of multifamily in its Los Angeles office, said good properties are "hard to find." The apartment sector may no longer be "in a free fall," he said, but "it is not stable just yet." And noting that Freddie Mac has reverted to underwriting guidelines that were in place before the housing sector went haywire, he said 70% of Freddie Mac's apartment loans represents "repeat business with good quality sponsors."