What Happens Next?
We expect that the FHFA will indeed increase sampling requirements; the question is how much of an increase they will implement. Minimizing tenant exposure to radon is a priority, but opinions differ as to how much testing is considered reasonable risk tolerance based on current research and available data. FHFA must consider the potential reduction in exposure against the potential impact of increased sampling requirements across the lending spectrum, including borrowers, lenders, investors, syndicators, and, of course, tenants. The potential impact and risk tolerance varies for each of these stakeholders, adding complexity to the challenge of determining appropriate test levels. FHFA must also determine the best implementation process, whether changes will take effect immediately or gradually, and whether to provide any flexibility to allow for sampling after the loan closes. FHFA analysis of the listening session transcript is to occur through the end of the year. Therefore, we expect FHFA to announce their findings and decision in the first or second quarter of 2022.
A video and transcript of the FHFA listening session on radon is available here.
https://www.fhfa.gov/Videos/Pages/%E2%80%8BMultifamily-Radon-Standards%E2%80%8B%E2%80%8B.aspx
Drew H. McCreery
Drew H. McCreery serves as Technical Director of Agency Services at Partner Engineering and Science, Inc., where he is responsible for the overall quality and consistency of Property Condition and Environmental reports associated with the Agency Lenders including Fannie Mae and Freddie Mac. Drew has over 20 years of experience providing project, engineering, and architectural consulting services focused on due diligence and construction management for clients around the country. He is a member of the American Institute of Architects and has a Bachelor of Architecture from California State Polytechnic University of Pomona. Drew frequently shares his deep knowledge of the policy, regulatory, and quality requirements as they pertain to the agency lending landscape through blogs, articles, and speaking engagements. He holds a BA in architecture from California State Polytechnic University of Pomona and pursued Architectural Studies at the National Technical University of Athens, Greece.
https://www.globest.com/2021/08/23/fhfa-to-increase-multifamily-radon-sampling-requirements/?slreturn=20210728173335
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