The GSEs are getting more aggressive on Class-B and –C assets. Case in point: Berkadia SVP Brant Smith (here with son Braden, who caught the fish) and VP Michael Levell just arranged $4M in financing for Cougar Court in Austin, locking in 4.67% interest and 70% LTV through Fannie Mae. Brant says we can expect to see the agencies get more competitive on these smaller, older deals as they try to maintain market share in the face of aggressive CMBS and bank lenders. That’s also pushing them to secondary and tertiary markets, like the $8.3M acquisition financing (4.87% interest and 77% LTV) Brant and Michael just lined up for a 150-unit community in McAllen.

Brant says he’s also seeing a trend of deeper rehabs in Austin. (He says the city is unique in that you can get over $1/SF rent for '70s-era properties.) His team also just arranged acquisition financing for Arbor Pointe (pictured), an early '80s property. (Just like '80s hairstyles, this pool allows you to party in the back.) Borrower Roscoe Properties plans to invest $20k to $25k/unit to bring it up to speed. Brant tells us this level of value-add is particularly popular on South Lamar and South First, where a big wave of new construction has raised the standard.