By ELIOT BROWN And NICK TIMIRAOS

Fannie Mae is planning to sell a stake in scores of apartment buildings to Related Cos., the New York private real-estate company controlled by Stephen Ross, according to people familiar with the matter.

Under terms of the deal, Fannie would sell to Related a 25% stake in the government-controlled company’s inventory, which is valued at about $300 million, according to people familiar with the matter. Terms of the deal couldn’t be determined.

Fannie also would sell Related stakes in future foreclosed multifamily properties, which are expected to be added to the portfolio as Fannie takes them over in the coming years, these people said. Related would be required to invest in maintenance and management of the properties.

The deal would represent the first major bulk sale of foreclosed property by Fannie Mae, which has seized a number of apartment buildings from landlords in recent years as the loans fell into default.

Although lending to landlords makes up a relatively small portion of Fannie’s overall mortgage portfolio, the amount of foreclosed apartment buildings, which tend to be middle- and lower-income rentals, is on the rise. Fannie reported $596 million in foreclosed multifamily properties at the end of 2010, more than double what the company reported a year earlier.

If completed, the transaction would mark a shift for the mortgage company. Until now, Fannie was selling off apartment buildings seized from landlords individually, often at distressed prices. But as its stock of foreclosed buildings increases, Fannie is seeking an investor to help boost values of the buildings while keeping a majority stake on its books, people familiar with the deal said.

Both companies, which were taken over by the federal government during the financial crisis of 2008 and required $134 billion in taxpayer bailouts, have largely resisted bulk sales of single-family properties or nonperforming loans. The firms believe they can make more money selling properties individually. They also want to avoid liquidating houses at fire-sale prices, which would erode the value of properties that they either own or are used to secure loans they guarantee.

The multifamily sector overall has recovered faster than other types of commercial real estate. But most apartment-building values still are well below 2007 levels, and delinquency rates on loans remain high. As a number of loans made during the peak years come due in the next five years, Fannie is expected to see its foreclosures on multifamily buildings rise.

“Weak economic conditions have caused new foreclosures to outpace dispositions,” the company said of multifamily properties in a February filing with the Securities and Exchange Commission.

via Related to Buy Stake in Fannie Apartment Portfolio – WSJ.com.