June 19, 2020
In December 2019, Freddie Mac Multifamily brought to market K-F73: the first multifamily real estate securitization with bonds indexed to SOFR. This transaction paved the way for the CMBS industry in the transition away from LIBOR and established a solid foundation for SOFR-indexed K-Deals® going forward.
I’m excited to share the great news that K-F73 has been recognized by GlobalCapital in their 2019 US Securitization awards as the CMBS Deal of the Year. GlobalCapital specifically recognized our ability to think outside the box and provide a guarantee on the AS (SOFR-indexed) class that covers any basis mismatch if the SOFR-based index exceeds the LIBOR-based index. Furthermore, the deal was structured so that the underlying multifamily loans and the AL (LIBOR-indexed) class will convert to an alternate index if LIBOR ceases to be published. This transaction was well received by the market and set a precedent for other issuers to follow.
On behalf of our entire group, I would like to thank the K-F73 deal team – our lead banks Morgan Stanley and Goldman Sachs, and co-managers Amherst, Bank of America, CastleOak and Wells Fargo – for their commitment and success in bringing this to market. And I would like to thank you all for your partnership and important role with our firm – from lending to securitization. This is an honor that we can all be proud of.
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