Freddie Mac said today that it expects its fifteenth multifamily CMBS from its K multifamily series of deals to price this week.
The $1.2 billion structured passthrough certificates in the offering called K-711 will be backed exclusively by fixed-rate multifamily mortgages with a seven-year term.
The K-711 certificates are backed by 76 recently-originated multifamily mortgages and are guaranteed by the GSE.
The deal includes two senior principal and interest classes, a senior interest only class and a junior interest only class.
The loans have principal balances that range from $1.7 million to $68.8 million for the biggest loan, which is backed by the fee simple interest in Canyon Creek Apartments (5.0%), according to Kroll Bond Rating presale report on the deal released this morning. Canyon Creek is a 558-unit garden-style apartment building in Bothell, Washington.
The top five loans make up 20.2% of the pool cut-off balance, and cover: Hudson Park North in Yonkers, NY (4.5%): Lincoln Meadows in Schaumburg, IL (4.4%): Seramonte Apartments in Hamden, CT (3.4%): and Gardens East Apartments in Palm Beach Gardens, FL (2.9%).
The top ten exposures represent 33.6%. Most of the properties are garden-style apartment projects (60 properties, 80.6%). The properties range in size from 21 to 576 units. The underlying collateral properties are geographically dispersed in 22 states. The three biggest state exposures are Florida (21.5%, 15 properties), California (12.5%, 13 properties) and Washington (10.2%, five properties), Kroll reported. Additionally, no other state individually represents over 8% of the total pool balance.
Fitch Ratings and Kroll will rate the three senior classes of K-711 certificates, which are each expected to receive a rating of 'AAA'.
Wells Fargo and Morgan Stanley are co-lead managers and joint bookrunners on the deal. Barclays Capital, Deutsche Bank Securities, Guggenheim Securities, Bank of America Merrill Lynch will serve as co-managers.