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Freddie Mac and Johnson Capital Announce the Financing of $135 Million Using Freddie Mac's Newly Developed Acquisition Rehabilitation Mortgage^SM

Borrower Will Rehab 914-Unit Windsor Gardens In Norwood, Mass.

McLean, VA – Freddie Mac announced that Johnson Capital, one of its first Seller/Servicers to do so, is using the Freddie Mac Acquisition Rehabilitation Mortgage^SM product to provide $135 million in financing, enabling the repeat borrower to rehabilitate the 914-unit Windsor Gardens Apartments in Norwood, Mass. The borrower also made use of Freddie Mac's Early Rate-Lock delivery option, choosing to wait 90 days after rate-lock until Freddie Mac's purchase of the loan.

Proposed improvements to Windsor Gardens consist of adding washing machines and dryers to the garden-style units, new countertops, cabinet faces and knobs, tubs, shower surrounds, toilets, ceramic flooring, lighting, plumbing fixtures, six-panel doors and new door hardware, new bathroom components and accessories, and installation of new smoke detectors. Improvements will be made with minimal tenant displacement.

"The Freddie Mac Acquisition Rehabilitation Mortgage enabled Johnson Capital to provide a valued client a well-structured loan product that was consistent with Freddie Mac's mission and the borrower's real estate finance needs on a multifamily acquisition they intended to rehabilitate," said Martin Fayer, senior vice president and principal of Johnson Capital. "This product is a win-win since it provides the borrower with a way to appropriately finance a portion of the total capital commitment of the rehabilitation, while simultaneously providing the rental consumer upgraded existing housing at reasonable rental levels."

"Acquisition Rehabilitation provides the opportunity to recognize the upside potential that a property has and to lend against it," said Michael Edelman, Freddie Mac managing regional director, Northeast Region. "We're finding more Seller/Servicers and borrowers are taking advantage of its benefits."

In 2007, Freddie Mac funded 30 transactions using the Acquisition Upgrade Mortgage^SM and the Freddie Mac Acquisition Rehabilitation Mortgage, for a total of $788 million.

Since the launching of Freddie Mac's current multifamily business in 1993, Freddie Mac has purchased more than $165 billion in multifamily mortgages, financing rental housing for more than four million families.

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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