Three Channels, One Decision
For a stabilized multifamily or commercial asset seeking long-term debt, sponsors typically have three institutional execution channels: Agency (Fannie Mae / Freddie Mac), Life Insurance Companies, and CMBS (Conduit). Each serves a different sponsor profile and asset type.
Agency Financing
Agency loans through Fannie Mae and Freddie Mac remain the gold standard for multifamily permanent financing. Strengths include non-recourse structure, 30-year amortization, competitive all-in pricing, and assumability. Current agency rates for 10-year fixed multifamily debt hover in the 5.5–6.25% range depending on LTV and market.
Agency is not available for most commercial asset types. Mixed-use, retail, office, and industrial require life company or CMBS execution.
Life Insurance Company Financing
Life companies offer the most relationship-driven permanent execution. They typically target lower leverage (55–65% LTV), high-quality assets, and strong sponsorship — but reward those attributes with the most competitive pricing in the market (often 20–40 bps inside CMBS). Prepayment flexibility varies by lender and can be negotiated.
CMBS / Conduit
CMBS remains the primary execution channel for commercial asset types where agency is unavailable. Strengths include higher leverage tolerance (up to 75% LTV), flexible property types, and relatively standardized documentation. The tradeoff is yield maintenance prepayment penalties and servicer complexity during the loan term.
Our Process
We run a parallel process across eligible lenders in each channel to generate true market competition. A sponsor should never take the first term sheet — even in a tighter market, the spread between best and worst execution is often 25–50 bps on the interest rate and meaningful differences in structure and fees.