Which Berkshire Is Buying the Apartment Lender MF1

The first thing to sort out is whose deal this is, because "Berkshire" is doing a lot of work in the headlines and the name happens to belong to two entirely different companies. There is Berkshire Residential Investments, the Boston firm founded in 1966 by brothers George and Douglas Krupp that manages over $34 billion in U.S. residential real estate for institutional investors. And there is Berkshire Hathaway — the Omaha conglomerate with the insurance, the railroad, the annual meeting. They are separate firms, and if you assumed this story was about the second one, you are reading the wrong transaction. Here is the transaction: Berkshire Residential has agreed to buy out the other half of a multifamily mortgage lender called MF1 Process LLC. MF1 was launched in 2018 as a 50/50 joint venture between Berkshire and Scott Waynebern, founder of the New York real estate credit firm Limekiln. Upon closing, MF1 becomes a wholly-owned subsidiary of Berkshire — a platform that has originated roughly $32 billion in multifamily loans since 2018. The purchase price was not disclosed. Most of Limekiln's employees are expected to become Berkshire employees, which is a polite way of saying the seller's operating team converts into the buyer's staff. The reason to care about any of this is what MF1 actually is. It is described as the leading private-label multifamily mortgage lender and a leading issuer of commercial real estate collateralized loan obligations, or CRE CLOs. "Private-label" is the key word. It means MF1 does not sell its loans to the government-sponsored mortgage giants, Fannie Mae and Freddie Mac, the way mainstream home lenders do. Instead it finances a large portion of its apartment loans by packaging them into CRE CLOs and selling those securities to institutional investors, then using the proceeds to fund still more loans.

Run that loop and you have an originate-to-securitize machine: make apartment loans, bundle them into CLO bonds, sell the bonds, lend again. This is not new finance wearing a buzzword; it is old private-credit securitization in a wrapper that keeps the loans off the agency balance sheets. The cost of that choice is dependence. Because the loans have nowhere else to go, the whole platform only keeps lending if the securitization market stays open. And the market did not stay open. When the Federal Reserve hiked rates in 2022, multifamily values fell and the CLO market seized up. The strain showed up inside MF1's own book: by August 2023, nearly half of its roughly $11 billion amortizing loan book was watchlisted or delinquent. The firm had been the favored lender to apartment syndicators in distress, the sort of operators who fund aggressive buying with high-leverage loans. Taking control of the whole machine is the point of the deal. When the transaction closes, Berkshire holds all of MF1 — the securitization engine and the loan book it currently sits on, whatever condition that book is in. There is no joint-venture partner left to share the decisions, or to share the risk. The entity that makes apartment loans and turns them into CLO bonds becomes one wholly-owned franchise. This is a serial issuer under its own label, not a one-off. In January 2022 MF1 issued its eighth securitization, MF1 2022-FL8, backed by 38 properties across 24 U.S. markets. That is the portrait of the machine operating at scale: a private lender converting apartment loans into liquid securities, deal after deal, through a market that proved it can freeze. So when you see the deal, see the mechanism, not the name. A property investment manager is folding a private-label multifamily lending-and-securitization platform into one wholly-owned franchise, buying out the partner that helped build it. There is no Omaha in this story — just a rent-lending machine, its loan book, and the securitization market it depends on, now under a single owner.