REBusiness Online speaks with Jeff Erxleben: Rising interest rates take toll on Fannie, Freddie deal volume

DALLAS (July 14, 2023) — Fannie Mae and Freddie Mac multifamily divisions started slow this year as they faced rising interest rates. While options are limited, Freddie Mac and Fannie Mae have been excellent partners for multifamily borrowers during this time.

In a recent REBusiness Online article, “Rising interest rates take toll on Fannie, Freddie deal volume,” Northmarq President of Debt & Equity Jeff Erxleben said, “The banking turmoil has curtailed debt capital, which has provided more inflows to the agencies.”

Agency mortgage lenders are finding that borrowers want shorter terms and flexible prepayment options in addition to fixed interest rates. “That’s a popular choice because borrowers want to have as little maturity risk as possible and get the most creative financing,” Erxleben said. “The market by and large has been looking for stability as it relates to rates and as it relates to capital structure.”

Lending partners expect an acceleration in deal velocity in the remainder of 2023, and Erxleben said the biggest silver lining is that the government-sponsored enterprises (GSE) will continue to provide options for borrowers – whatever their needs and goals may be.

“There is still capital to spend,” Erxleben said. “Both agencies are going to provide liquidity throughout no matter how the rest of the year unfolds, which is a good thing.”

Topics covered in the article include:

  • Property sales decline.
  • Underwriting trends.
  • Robust outlook.

Read the full article.

Northmarq is a full-service capital markets resource for commercial real estate investors, offering seamless collaboration with top experts in debt, equity, investment sales, loan servicing, and fund management. The company combines industry-leading capabilities with a flexible structure, enabling its national team of experienced professionals to create innovative solutions for clients. Northmarq's solid foundation and entrepreneurial approach have built an annual transaction volume of more than $39 billion and a loan servicing portfolio of more than $76 billion. Through the 2022 acquisition of Stan Johnson Company and Four Pillars Capital Markets, Northmarq established itself as a provider of opportunities across all major asset classes. For more information, visit: