Freddie Mac Announces K-705 Offering of K Certificates Backed Only by 7-Year Multifamily Mortgages via MarketWatch

Freddie Mac FMCC +4.00% today announced its fifth offering of Structured Pass-Through Certificates ("K Certificates") backed exclusively by multifamily mortgages with a 7-year term. The company expects to offer approximately $1.0 billion in K Certificates ("K-705 Certificates"), which are expected to price the week of January 16, 2012, and settle on or about February 7, 2012.

The K-705 Certificates will be offered to the market by a syndicate of dealers led by Credit Suisse Securities (USA) LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated as co-lead managers and joint bookrunners for the transaction. Barclays Capital Inc., CastleOak Securities, L.P., Jefferies & Company, Inc., and J.P. Morgan Securities LLC will serve as co-managers for the transaction. The K-705 Certificates are backed by 70 recently-originated multifamily mortgages and are guaranteed by Freddie Mac. Rating agencies Fitch, Inc. and Moody's Investors Service, Inc. have been engaged to rate the three senior classes of K-705 Certificates, which are each expected to receive a rating of "AAA(sf)" and "Aaa(sf)", respectively, subject to on-going monitoring.

"This is our first K-Deal offering of the year," said Mitch Resnick, co-head of Multifamily Capital Markets for Freddie Mac. "In 2011, we were one of the top issuers in the CMBS market with 12 K-Deals, representing almost $14 billion in securities. We expect to issue at least as many deals in 2012 as our program continues to grow."

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