2008-09-15 23:52:01 -
www.centerline.com - Centerline Holding Company, New York Elizabeth Haukaas, Senior Vice President of Corporate Communications, 212-521-6453 Centerline Holding Company (NYSE:CHC), the parent company of Centerline Capital Group (the "Company" or "Centerline"), an alternative asset manager focused on real estate funds and financing, supports the federal government's action placing Fannie Mae and Freddie Mac under conservatorship of the Federal Housing Finance
Agency (FHFA), their regulator. In response to speculation regarding how government control of the enterprises might affect their multifamily housing finance activities during conservatorship, the FHFA issued a statement September 12, 2008 stating that business will continue as usual at both Fannie Mae and Freddie Mac during the conservatorship for all aspects of their mortgage financing businesses.
In the same statement, the FHFA acknowledged that support of multifamily housing is central to both enterprises' public mission and stated its support of the low-income housing tax credit (LIHTC) and liquidity vehicles for re-marketed mortgage revenue bonds. As conservator, the statement continued, the FHFA expects both Fannie Mae and Freddie Mac to continue underwriting and financing sound multifamily business and does not expect to liquidate its portfolio of LIHTC or mortgage-revenue bonds. Nor does the conservatorship affect existing contracts or the authority of either Freddie Mac or Fannie Mae to enter into new contracts.
Executives at Centerline understand takeover of Fannie Mae and Freddie Mac by the federal government was a necessary move given both companies' current financial positions and concur with most economists in the belief that the credit crisis cannot abate until the US housing market begins to recover. Under published terms of the federal government's control, debt for both Fannie Mae and Freddie Mac is guaranteed by the US Treasury up to $100 billion for each company. According to industry experts, one expected result of the government action in the short term is that both Fannie Mae and Freddie Mac should soon be able to borrow at lower costs, which means those savings can eventually be passed along to mortgage borrowers in the form of lower mortgage interest rates.
Centerline is not involved in the home mortgage business. However, the Company is involved with Fannie Mae and Freddie Mac in its multifamily rental housing finance business, which extends across the Company's affordable housing, commercial real estate agency lending products and portfolio management groups. It is believed another positive result of the government action extends to the commercial mortgage sector and that both companies could begin to expand their mortgage activities now that they have Treasury backing.
"We support the government's actions last week to shore up Fannie Mae and Freddie Mac's financial conditions. We believe it could have a steadying impact on confidence in the mortgage financing markets as a result," said Marc Schnitzer, President and CEO of Centerline Capital Group. "Our multifamily financing business is still strong. We expect to continue doing business with both companies in our multifamily and affordable housing lending practices," he added.
About Centerline Capital Group
Centerline Capital Group, a subsidiary of Centerline Holding Company (NYSE:CHC), is an alternative asset manager focused on real estate funds and financing. As of June 30, 2008, Centerline had more than $14 billion of assets under management. Centerline is headquartered in New York, New York and has nine offices throughout the United States. For more information, please visit Centerline's website at
www.centerline.com or contact Elizabeth Haukaas at 212.521.6453.
Certain statements in this document may constitute forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are detailed in Centerline Holding Company's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, and include, among others, adverse changes in real estate markets, general economic and business conditions; adverse changes in credit markets and risks related to the form and structure of our financing arrangements; our ability to generate new income sources, raise capital for investment funds and maintain business relationships with providers and users of capital; changes in applicable laws and regulations; our tax treatment, the tax treatment of our subsidiaries and the tax treatment of our investments; competition with other companies; risk of loss from direct and indirect investments in commercial mortgage-backed securities and collateralized debt obligations; risk of loss under mortgage banking loss sharing agreements; and risks associated with providing credit intermediation. Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates" and similar expressions are intended to identify forward-looking statements. Such forward-looking statements speak only as of the date of this document. Centerline Holding Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Centerline Holding Company's expectations with regard thereto or change in events, conditions, or circumstances on which any such statement is based.
FHFA States Multifamily Businesses to Continue as Usual
