Bridge Multifamily, Freddie Mac Team Up for Affordable Housing Initiative
- May 07, 2018
Bridge Multifamily Fund Manager, an affiliate of Bridge Investment Group, has closed the first financing under Freddie Mac’s MultiAsset Commitment, designed to provide long-term affordable housing to low-income and working families. Under this transaction, Freddie Mac will purchase and aggregate up to $500 million in loans over a one-year period, allowing Bridge to acquire, improve and preserve workforce and affordable housing across the U.S.
After the terms end, Freddie Mac will place the aggregated loans in a single securitization, in which Bridge will be require to purchase the subordinate bonds. Wells Fargo will originate $400 million and KeyBank will originate the remaining $100 million. This deal motivates Bridge to keep rents affordable without having to rely on federal, municipal or state affordable housing programs.
First Financing Acquisition
With this financing, Bridge agreed that majority of the units in each community will be reserved for residents earning below 80 percent of the area median income and will stay that way for the life of each loan. The firm recently acquired Plantation at Walden Lake in Plant City, Fla., marking the first property to be purchased within this financing vehicle. Located at 1400 Plantation Blvd., the 352-unit community was acquired for $35.7 million from Mercury Investments. Plantation at Walden Lake currently has 82 percent of rents affordable to those earning 80 percent or less of the AMI. Cushman & Wakefield’s Senior Directors Luis Elorza and Brand Capas, as well as Vice Chairman Robert Given, represented the seller in the deal.
“This financing commitment from Freddie Mac will allow us to further expand and strengthen our commitment to investing in workforce and affordable housing properties across the U.S.,” Robert Morse, executive chairman of Bridge Investment Group, told Multi-Housing News. “Our value-add business model is actually ideal for these types of properties and will enable us to provide more than just ‘four walls and roof’ for our residents—we can give them the community programs, facilities and educational resources they deserve at a price point they can afford.”
The firm plans on renovating the apartment interiors and common areas, as well as adding a soccer field to the community. Bridge will also construct an on-site social and community center to increase social mobility within residents, which will be run by Project Access, its nonprofit partner.
Earlier this month, KeyBank and Freddie Mac teamed up once again to originate a $247.8 million first mortgage loan for The Lorenzo, a Class A student housing community in Los Angeles.
Stock image courtesy of Flickr, Property image courtesy of Yardi Matrix