The GSE alleges the borrower can no longer keep the property running
Freddie Mac wants a receiver to take over a 252-unit Seattle apartment complex, claiming the borrower owes nearly $7 million and can no longer keep the property running.
The government-sponsored enterprise filed its case on January 16 in the Western District of Washington, targeting GRE Downtowner LLC, the limited liability company that owns the Downtowner Apartments in downtown Seattle. The move offers a window into how one of the nation's secondary mortgage market giants handles multifamily loans gone south.
At the heart of the dispute is a reimbursement agreement dating back to June 2012. That year, the Washington State Housing Finance Commission issued $24 million in multifamily housing revenue bonds to finance the property. East West Bank originated the mortgage loan, with a maturity date of July 2030. Freddie Mac stepped in with a credit enhancement agreement to backstop certain bond payments, and in return, the borrower promised to reimburse Freddie Mac for any amounts it had to cover.
That arrangement, according to court filings, has now unraveled.
Freddie Mac says the borrower stopped meeting its obligations under the reimbursement agreement, racking up unpaid amounts, late charges, default interest, and legal fees. As of late September 2025, the tab stood at $6,916,978.69 and climbing.
The timeline suggests patience wearing thin. Freddie Mac's servicer first flagged the default in a formal notice back in December 2023. A second letter followed in early December 2025, this time from attorneys. The borrower, according to the filings, never cured the problem.
Now Freddie Mac is asking the court to install Trigild IVL, LLC as receiver to take possession of the property, collect rents, and manage operations. The enterprise also wants a judge to officially declare the borrower in default and order a full accounting of the property's books.
What makes this case textbook for mortgage professionals is buried in the original loan documents. Section 3(d) of the deed of trust includes a consent-to-receiver clause, meaning the borrower agreed upfront that Freddie Mac could seek a receiver after any default, no prior notice required. The borrower also committed to surrender the property immediately and hand over all records the moment a receiver steps in.
These provisions are not unusual in commercial lending, but watching them invoked in real time is a reminder of why they matter. When a borrower runs out of financial runway, these clauses give lenders a faster path to protect collateral.
The Federal Housing Finance Agency, which has overseen Freddie Mac as conservator since September 2008, has signaled its support for the receivership on the proposed terms.
No court has ruled on the merits, and the borrower has yet to formally respond. But for anyone working in multifamily finance, the case is worth watching as a case study in how enforcement plays out when reimbursement agreements fall apart.
