Fannie and Freddie loans could pose conflicts for Kushner

Real estate firm used Fannie and Freddie loans to finance 11 acquisitions and refinance 3 properties

TRD MIAMI /
Feb.February 17, 2017 04:30 PM

FHFA’s Mel Watt and Jared Kushner

From the New York website: Kushner Companies has $568.8 million in loans backed by Fannie Mae and Freddie Mac outstanding, creating the potential for conflicts of interest as White House and Congress debate the future of the two mortgage giants.

The real estate company owns around 20,000 apartments on the Eastern Seaboard, and has taken out Fannie and Freddie loans to finance 11 acquisitions and refinance 3 properties, mostly in Maryland, according to Real Capital Analytics.

Jared Kushner, who headed Kushner Companies until January, now works as a senior adviser to his father-in-law, President Donald Trump. He has vowed to sell his stakes in real estate assets and to recuse himself from decisions impacting the family business. A Kushner spokesperson declined to tell Bloomberg whether Jared still holds stakes in properties with Fannie or Freddie loans.

“The election has not changed Kushner Companies’ relationship with Fannie Mae and Freddie Mac,” the spokesperson said to Bloomberg. “And we will respond to policy changes like any other private company in the marketplace.”

If Kushner were to default on any of the loans in questions, it could put the two companies, which are currently in government conservatorship, in the uncomfortable position of having to foreclose on assets controlled by the president’s immediate family.

“It clearly represents a conflict-of-interest because the government or the president can take actions that would benefit his family,” Brooklyn Law School professor David Reiss told Bloomberg.

The White House has announced it plans to overhaul the housing finance system, in a move that would likely also impact multifamily lending. [Bloomberg]Konrad Putzier


Related Articles

arrow_forward_ios
From left: Stuart Elliott, Jerome Hollo, Michael Shvo, Laurent Morali and Lissette Calderon

South Florida developers riff on the shift from condos to rentals: TRD Miami Showcase & Forum

Charlie Kushner and Laurent Morali over Fort Lauderdale site (Credit: Google Maps)

Kushner goes to Broward, buying site near Fort Lauderdale train station

Daily Digest Miami

Related is heading to the river, Soffer eyes Fontainebleau Miami Beach expansion: Daily digest

Rendering of the Brickell hotel development, Tony Cho and Robert Finvarb

Finvarb and Cho land construction loan for mixed-use hotel near Brickell City Centre

Rendering of the Wynwood development, Charlie Kushner and Laurent Morali

Kushner and Block Capital pay $32M for Wynwood sites of mixed-use projects

Developer borrows $105M, breaks ground for mixed-use Flagler Village project

Neiman Marcus CEO Geoffroy Van Raemdonck (Credit: Getty Images)

Struggling Neiman Marcus scores loan from Credit Suisse for Coral Gables store

Developers land $74.5M loan for condo construction project at Ocean Reef Club

arrow_forward_ios