FREDDIE MAC AND SIERRA CAPITAL PROVIDE FINANCING FOR ACQUISITION AND REHAB OF PARK PLACE BY THE WOODS

All 210 Units Are Affordable, In An Underserved Area

McLean, VA – Freddie Mac and Sierra Capital have provided $16 million in financing to MG Properties, enabling the repeat borrower to acquire and rehabilitate Park Place by the Woods, in Tukwila, Wash., using Freddie Mac's Acquisition Rehabilitation Mortgage^SM product.

"Sierra Capital Partners and Freddie Mac delivered loan terms and proceeds to our partnership as promised, securing approvals for our renovation/reposition plan during a highly volatile period for the financial markets," said Justin Smith, MG Properties senior vice president of Investments. "We closed our purchase transaction within a very compressed time frame, optimized the cost of our total cost of funds due to higher loan dollars that funded a portion of our rehab budget, and locked in a very low, fixed interest rate for 10 years."

Freddie Mac and Sierra Capital took the loan from initial application to approval in 10 days, getting the loan funded during a period of high volume late in 2007. Freddie Mac also accommodated the release of a portion of the property to enable light rail construction that will provide direct access to the downtown Seattle business district.

"This transaction was a great example of the good affordable business Freddie Mac does; we worked with Sierra Capital and the borrower every way we could to meet the borrower's financing needs," said Steve Griffin, Freddie Mac Western Region managing director. "As a result, Freddie Mac financing is helping to provide newly rehabbed apartments at affordable prices to low- and moderate-income residents in an underserved area."

"The Freddie Mac Acquisition Rehabilitation Mortgage product continues to fill a critical void in the debt market for high-quality borrowers and investors whose business model is to improve the quality of affordable multifamily housing,” said Bryan Frazier, principal of Sierra Capital. "Furthermore, the Western Region office helped manage the borrower's interest rate exposure by working together to coordinate the Early Rate-Lock approval with the expiration of the borrower's due diligence period. This joint cooperation allowed the borrower to lock the interest rate the same day they went non-refundable on their acquisition."

A total of 210 units makes up Park Place by the Woods. Within the garden-style property, 38 units are studios, 84 are 1-bedroom and 88 are 2-bedroom. Built in 1975, seven of the buildings are 3-story and three of the buildings are 2-story. One segment of the rehabilitation work will be to install a new fire alarm system. All repairs will be complete within 12 to 36 months.

Since the introduction of the Freddie Mac Program Plus® network of multifamily loan originators and servicers in 1993, Freddie Mac has provided financing for approximately 55,000 multifamily properties totaling more than $189 billion.

Freddie Mac is a stockholder-owned corporation established by Congress in 1970 to support homeownership and rental housing. Freddie Mac purchases single-family and multifamily residential mortgages and mortgage-related securities, which it finances primarily by issuing mortgage-related securities and debt instruments in the capital markets. Over the years, Freddie Mac has made home possible more than 50 million times, ensuring financing for one in six homebuyers and more than four million renters.

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