Freddie Mac Securitizes More Multifamily Mortgages

McLean, Va.--Freddie Mac has made a new offering of about $1 billion of K-011 Certificates, backed by 76 recently originated multifamily mortgages.

McLean, Va.–Freddie Mac has made a new offering of Structured Pass-through Certificates (“K Certificates”), which are multifamily mortgage-backed securities. The GSE expects to offer about $1 billion of these certificates–formally known as K-011 Certificates–which will probably price the week of March 21 and settle by March 31.

The K-011 Certificates are backed by 76 recently originated multifamily mortgages and are guaranteed by Freddie Mac. In February, the GSE rolled out its first K Certificates–K-701 in that case–which were backed by 44 newly originated seven-year multifamily mortgages, with an initial mortgage pool balance of about $1 billion.

The GSE did not comment to MHN regarding K-011, but Freddie Mac’s vice president of multifamily CMBS capital markets, David Brickman, noted in a statement earlier this week that “as the third Freddie Mac K-Deal of the year, K-011 demonstrates our commitment to maintaining periodic issuance throughout the year.”

Freddie Mac says that the K Certificates provide it with an efficient vehicle to securitize multifamily loans. For investors, the GSE adds, the certificates provide stable cash flows, structured credit enhancement and a Freddie Mac guarantee.

The co-lead managers and joint bookrunners for the transaction are Deutsche Bank Securities Inc. and Bank of America Merrill Lynch. Barclays Capital Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) L.L.C., Morgan Stanley & Co. Inc. and Wells Fargo Securities L.L.C. are co-managers for the transaction.

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