Arbor Realty Trust, one of the country’s major multifamily bridge lenders, is facing increased challenges as immigration enforcement intensifies in several key markets. CEO Ivan Kaufman stated during the company’s earnings call that a rise in ICE (Immigration and Customs Enforcement) raids has contributed to declining occupancy rates at apartment properties acquired through foreclosure. According to Kaufman, “You’re seeing a lot of ICE raids in those areas,” with Houston being particularly affected along with San Antonio, Dallas, Atlanta, and parts of Florida. He noted that some properties previously 90 percent occupied dropped to 65 or 70 percent “the next day.”
Kaufman further commented on the situation in Houston: “Houston has been ‘very adversely’ affected by immigration policy swings from both administrations,” and suggested that federal use of nearby immigration centers had negatively impacted local real estate.
Recent figures show a significant shift in Arbor’s financial position. The Long Island-based real estate investment trust ended 2025 with 15 multifamily Real Estate Owned (REO) properties—those taken back after unsuccessful foreclosure auctions. The company foreclosed on 21 loans last year, compared to six in 2024.
Loan delinquencies reached $570 million at year-end, while REO assets grew to $500 million—almost three times higher than the $177 million recorded at the end of 2024. Chief Financial Officer Paul Elenio said some repossessed properties are generating negative net operating income as Arbor works toward stabilization.
Despite these difficulties, Arbor sold five REO assets during 2025 and aims to reduce its REO balance to between $250 million and $300 million by the end of 2026. However, it expects another $100 million to $200 million worth of new repossessions within that timeframe.
The financial impact is visible in earnings: net interest income fell from $82.9 million in the fourth quarter of 2024 to $55.7 million for the same period in 2025.
Additionally, Bloomberg reported in July 2024 that Arbor was under investigation by the U.S. Department of Justice and FBI for its lending practices. It remains unclear whether those investigations are ongoing.
