SOURCE: Wall Street Journal Online

Government-sponsored Fannie Mae and Freddie Mac are fueling the fire for multifamily deals. Not only are they making credit available, their mandate is to provide market liquidity and funding for affordable housing which is allowing them to expand their portion of the multifamily market to fill the gap left by private lenders.

The multifamily sector "is the beneficiary of the housing mess, and it feels like it has room to run," says Mike Kirby, chairman of Green Street Advisors Inc., a Newport Beach , Calif. , REIT research group. He also said that "Fannie and Freddie are dominating the market. Normally they're just players."

Mike May, who is the senior vice president for multifamily at Freddie Mac feels that the apartment market helps his firm meet their goals for lending to affordable housing. Fannie Mae spokesman Jon Searles says that the multifamily market is attractive due to a number of perspectives which include the low delinquency rates that in January were just one-tenth of 1%.

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