Community Preservation Corp. Launches Mortgage Company

CPC Mortgage Co. will offer a suite of Freddie Mac, Fannie Mae and Federal Housing Administration products for the acquisition, refinancing, rehabilitation and construction of multifamily properties.

The Community Preservation Corp. (CPC), which has been building its agency lending business for several years resulting in nearly $500 million in originations in fiscal year 2018 and a portfolio of 154 loans, has launched CPC Mortgage Co. LLC to continue that expansion.

Sadie McKeown

CPC Mortgage Co. will be a subsidiary of CPC—a leading nonprofit affordable housing and community revitalization finance company—and will focus solely on the rapidly growing agency business. Revenues generated by CPC Mortgage Co. will help support CPC’s nonprofit mission.

The new mortgage company offers a suite of Freddie Mac, Fannie Mae and Federal Housing Administration products for the acquisition, refinance, rehabilitation and construction of multifamily properties. Billed as a one-stop shop for borrowers, CPC Mortgage Co.’s team will offer products for a broad range of capital needs including flexible bridge loans, as well as technical and institutional expertise in handling affordable, stabilized housing and small buildings/small balance loans.

“The launch of CPC Mortgage Company LLC brings our trademark dedication and ability to execute to borrowers looking for opportunities that agency products offer,” Sadie McKeown, EVP & Chief Operating Office at CPC, said in a prepared statement. “It’s not just about originating—we’re here to build relationships and put our borrower in the best position to be successful for the long-term.”

Rafael Cestero

For the past two fiscal years, the agency team operated under the CPC umbrella, The nonprofit leadership built the team from within the company and also by recruiting professionals with experience in agency originations, analysis, underwriting and asset management. When originations grew rapidly last year, the decision was made to create the standalone mortgage subsidiary. But the roots of CPC and its mission go back much further, to its founding in 1974 to serve the needs of the underserved communities and address capital challenges faced by owners and managers of small buildings and affordable housing. CPC became a Freddie Mac conventional lender in 1994, a Small Balance Loan seller/servicer in 2015 and recently added Fannie Mae and FHA licenses.

“It was important to us that CPC Mortgage Company not just be successful, but that it helps to further the nonprofit mission of CPC and that it’s true to our core values,” Rafael Cestero, CPC president & CEO, said in a prepared statement. “Having products that target affordable housing and small buildings is a perfect fit. Those are areas where our decades of experience put us in a position to provide unmatched value to our customers and communities.”

CPC’s Lending History

Since its inception, CPC has leveraged about $10.5 billion in private and public investment to finance more than 193,000 units of multifamily housing while also working with partners to revitalize neighborhoods and provide quality housing. CPC, which is based in New York City with several regional offices throughout New York state, is often involved as a partner in projects.

In January, CPC teamed with NCV Capital Partners, Mount Hope Housing Co. and Lemor Development Group to acquire Mount Hope Renaissance, a 515-unit, 13-building portfolio in South Bronx, N.Y., for $100 million. Located in the Mount Hope neighborhood, the portfolio will be renovated and preserved as affordable housing units. The deal was financed by equity investments from NCV and LDG. CPC and its lending partner Amalgamated Bank are providing a $30 million construction loan and CPC is also providing a SONYMA-insured permanent loan through its funding partnership with the New York City retirement systems. The project is part of Mayor Bill de Blasio’s New York housing plan, Housing New York 2.0, to produce 300,000 affordable homes by 2026.

Last October, CPC closed a total of $11 million in permanent mortgages under Freddie Mac’s Small Balance Loan (SBL) program for three Brooklyn multifamily buildings with 72 units.

Images courtesy of the Commercial Preservation Corp.