CARMEL, IND. — Indiana-based Merchants Capital has completed a $303 million securitization of 11 multifamily loans via its fourth Freddie Mac-sponsored Q-Series transaction. The loans, ranging from $4 million to $62 million, were used for the acquisition or refinancing of multifamily properties spanning eight states. Florida, Indiana, Colorado and New Jersey make up 81 percent of the loan balance. Most of the properties are workforce housing developments, with a significant portion of the units’ composition comprising less than 80 percent of the area median income.
According to Freddie Mac, Q transactions are structured pass-through securities backed by multifamily mortgage loans. They are backed by an underlying trust that holds multifamily mortgage loans that were not underwritten by Freddie Mac at the time they were originated, and the loans may not have been purchased by Freddie Mac prior to securitization.
Merchants Capital has been the loan seller in four of the last nine Freddie Mac Q transactions. The transaction supports financing of affordable housing in underserved markets, qualifying as social bonds within the social bonds framework published on Freddie Mac’s website. Proceeds from social bonds are used to provide liquidity to social impact financial institutions, including parent company Merchants Bank of Indiana.