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Freddie Mac prices $997M multifamily mortgage-backed pass-through certificates

Freddie Mac has priced an offering of structured pass-through certificates backed by floating-rate multifamily mortgages with 10-year terms.

The offering of about $997 million in K certificates is backed by 38 properties controlled indirectly by Starwood Capital Group. It is expected to settle on or about Aug. 18.

The transaction collateral is part of Freddie Mac's single-asset, single-borrower execution, which transfers first-loss credit risk on either one or multiple properties owned or controlled by a single sponsorship group. The certificates will include one senior principal and interest class, one interest-only class, and one class that will receive static prepayment premiums. The certificates are backed by corresponding classes issued by the FREMF 2017-KSW3 Mortgage Trust and guaranteed by Freddie Mac. The trust will also issue certificates consisting of the class B, C and R certificates, which will be subordinate to the other classes and not guaranteed by Freddie Mac.

Wells Fargo Securities LLC and Morgan Stanley & Co. LLC served as co-lead managers and book runners. CastleOak Securities LP, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and KGS-Alpha Capital Markets LP served as co-managers.