Freddie Mac is marketing its first K-Certificates offering backed exclusively by five-year multifamily mortgages.
The $1.1 billion structured passthrough certificates (K-certificates) are expected to price this week and settle on or about April 11, the GSE stated in a release today. The K-certificates are backed by 50 recently-originated multifamily mortgages and are guaranteed by Freddie Mac.
So far this year, including a deal that is expected to settle tomorrow, Freddie has completed three deals or $3.7 billion total. The previous offerings did not have loans backed by five-year mortgages. Standard K deals are backed by 10-year loans but Freddie has also issued K-certifcates backed only by seven-year loans, according to a press officer at the company.
The deal will be led by Wells Fargo Securities and Morgan Stanley as co-lead managers and joint bookrunners. Bank of America Merrill Lynch, Credit Suisse and Guggenheim Securities will serve as co-managers.
The offering is structured with two senior principal and interest classes, two senior interest-only classes and a junior interest-only class. Moody's Investors Service and Morningstar have assigned a preliminary rating of 'Aaa(sf)' and 'AAA', respectively, to the notes.