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Wednesday, April 02, 2014

Here is a whole nest of vipers:


Fannie Mae holds quiet equity stake in $1B portfolio: sources

A business plan created in 2007 to support the underwriting for the acquisition projected an 80 percent increase in net operating income by 2014, according to data reviewed by TRD. That rise — from under $40 million to about $70 million — was predicated on a 50 percent increase in revenues, information obtained by TRD revealed. Such a hike in revenue would be difficult without sharply increasing rents, which would cost the federal government millions of dollars. Alternately, Section 8 tenants could vacate, which would result in a loss of affordable units in the properties.
Because the Section 8 tenants’ rents are subsidized by the federal government, the bulk of any increase in rents from those tenants is paid for by the U.S. Treasury.
In addition to the equity, Fannie holds $800 million in debt on the properties.

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