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The pandemic is testing the affordable housing industry in ways never imagined. How will developers, owners, lenders, investors, and agencies respond to the new normal? What can we do to seize the moment with policies and practices that advance clean, safe housing for all?

One of the central figures in advancing development activity is Sarah Garland. Garland is the director of CBRE Affordable Housing – Debt and Structured Finance. Her background includes senior leadership posts at Fannie Mae and PNC Bank as well as service as the former chair of the Mortgage Bankers Association (MBA) FHA committee and vice chair of the MBA multifamily steering committee.

Garland recently shared her views on how she sees the industry evolving during the pandemic. Hint: She’s upbeat about the industry’s prospects.

Sarah Garland, director, CBRE Affordable Housing – Debt and Structured Finance
Marissa Natkin Sarah Garland, director, CBRE Affordable Housing – Debt and Structured Finance

There’s a temptation to compare today with 2008. Is it a fair comparison?
I don’t think so. Back in 2008, multifamily was OK. There were very few outright forbearances. Owners often went straight to note modifications and interest rate adjustment instead of forbearance. People weren’t losing their jobs like they are now. Lenders were in trouble. Not necessarily the residents.

You mentioned forbearance. How are you advising clients weighing payment options?
We receive lots of inquiries on forbearance options. We advise every borrower, ‘Don’t take forbearance unless you really need it, because you only get 90 days.’ So far, most people aren’t taking it. If you’re at break even, you can make the payment. It’s best to hold off as long as possible.

We are also making it clear that Fannie Mae and Freddie Mac have said there is no black mark against you if you request forbearance. There isn’t a no-loan list.

Are there any big misconceptions circulating today?
The initial one was that lending was shut down. Fannie and Freddie never pulled out. FHA never pulled out. Lending is pushing on, and we are continuing to work with many great lenders and investors.

What keeps you awake at night?
The execution of the CARES Act, particularly the stimulus cash distribution directly to the tenants. There really isn’t a mechanism to quickly move funds efficiently. You may qualify, but you may not see money for weeks, and for those tenants most in need, it could be too late. If the tenants can’t get the stimulus money to pay their rent, it will directly affect the borrower’s ability to pay their mortgages.

What are your thoughts on workforce housing?
Workforce housing is going to continue to play a big role in today’s market conditions. With the high unemployment numbers, it’s more critical than ever that we get the definitions of affordable changed to include workforce housing. The MBA and the industry are making a big push on getting this done so workforce properties and their tenants will be included in affordable housing policy decisions.

Does the pandemic have a silver lining?
It does. Banks want to help. Fannie and Freddie want to help. Your landlord wants to help. The pandemic is bringing people together like never before to collectively figure each step out. Everyone is reaching out to each other and working together. The affordable housing industry, and more specifically the lenders within, remain committed to helping borrowers keep affordable housing affordable for those who need it the most—the tenants.

I feel fortunate to be part of this industry. We have a very, very strong focus and voice.

For assistance with affordable multifamily finance, visit CBRE Affordable Housing.