When it comes to financing your multifamily property, securing a $5 million loan can demand just as much of your time and effort as securing a $100 million loan. If you’re a borrower looking to finance multiple properties, we at Walker & Dunlop believe portfolio financing — multiple loans processed simultaneously or a single loan covering multiple properties — should be an essential part of your financing strategy.

There are benefits to financing your properties as a portfolio including:

• Cost savings for third party reports and fees: When financing your portfolio of multifamily properties, we negotiate the most competitive pricing bundles for third party reports. Our appraisal, engineering, credit reporting, and lender attorney vendors often offer more competitive per property fees when assigned a portfolio of properties at once.
• More competitive interest rates: Agency financing (Fannie Mae/Freddie Mac) offers competitive interest rates, particularly for portfolio loans. You may be able to save up to half a percentage point or more! Ask your Walker & Dunlop expert for more details.
• Financing flexibility: Do you plan to sell some of your properties in the short term and hold others long term? Great! We can help you navigate flexible prepayment options so each property in your portfolio is matched with its individual business plans.
• Efficiency & time savings: Lending due diligence requires that you submit your personal financial statement, a schedule of real estate owned, and liquid account statements. Rather than tediously collect this information each time you apply for a loan, do it once by financing multiple properties simultaneously.

“A portfolio execution can incorporate several different types of loans,” says Allison Herrera, Walker & Dunlop Senior Director. “Some properties may only need a rate and term refinance. Others may be used to cash out equity for future investments or fund renovations. Others may need acquisition financing. We can accomplish all these things in one single portfolio execution.”

Expertise You Can Trust

Whether financing large or small transactions, you need a true local multifamily expert who understands the trends and rates in your area. Our dedicated SBL team knows the small-to-middle-market multifamily sector inside and out. That’s why we’re getting deals done.

In 2022 so far, our team has financed 22 portfolios, $233 million in total financing encompassing over 3,000 multifamily units nationwide — from the Pacific Coast and Rocky Mountains to the Southeast and Mid-Atlantic.

“We’re a direct Freddie Mac and Fannie Mae lender with market experts from coast to coast and are continuously developing technology to streamline the process. We’re a one-stop shop in a growing space,” said Walker & Dunlop Senior Analyst Cameron Devine.

Here’s an example of a New England workforce housing portfolio deal our team recently financed:

The Opportunity

A sponsor approached our small balance lending team to finance an eight-property portfolio. The opportunity had “everything going for it,” said Managing Director Jared Sobel, who had worked with this sponsor from his very first multifamily deal. The properties met Fannie Mae’s affordability and mission goals, providing much-needed workforce housing in a submarket with rising rents.

The Solution

Yet these advantages didn’t make the journey easy. There’s no room for error when navigating the details and locking in rates, particularly in a rising interest rate environment where speed to close can make a drastic difference in your all-in rate.

“The product is always evolving, and deals are not one-size-fits-all so you need to know the exceptions, the waivers, who to talk to — and if you haven’t done a million things correctly, you will not get financing. You need to be working with market experts and people who know what they’re doing,” Sobel said. He noted that with Walker & Dunlop “you’re getting a publicly traded company bringing an institutional mentality to the private capital space.”

The Results

This experience and attentiveness paid off. “We ended up in a spot that was beneficial for production, credit, and the client,” Sobel said: $19.9 million in Fannie Mae financing for the eight properties, then another deal for the same sponsor in the same market.

“The more deals we do with them, the more we learn about them, and the more we’re able to grow a relationship and yield results,” Sobel added.

Take the Next Step

Our team of small balance lending professionals has the experience, technology, and resources to seamlessly structure your portfolio deal. For financing support or questions about the process, contact our team.