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The owner of the Terrace Manor apartments in Southeast D.C. sought bankruptcy protection Thursday amid fresh allegations that it failed to respond to housing code violations at the 61-unit housing complex, the Washington Business Journal reported on Friday. The chapter 11 filing in U.S. Bankruptcy Court in the District put a temporary hold on two motions that D.C. Attorney General Karl Racine filed earlier on Thursday against Terrace Manor LLC stemming from housing code violations. The LLC, which is owned by an affiliate of Bethesda-based Sanford Capital, listed between $1 million and $10 million in assets and the same amount in liabilities.

A bipartisan group of senators told Mel Watt, the regulator who oversees Fannie Mae and Freddie Mac, that he shouldn’t allow the companies to recapitalize without congressional approval, Bloomberg News reported. Letting the U.S.-controlled mortgage giants build capital buffers would hurt legislative efforts to overhaul the housing-finance system, the senators said in a letter yesterday. The letter to Watt, who is director of the Federal Housing Finance Agency, was signed by Republicans Bob Corker of Tennessee and Thom Tillis of North Carolina, as well as Democrats Mark Warner of Virginia, Heidi Heitkamp of North Dakota and Jon Tester of Montana. The lawmakers said they wrote to “express our concern regarding any administrative action that would adversely impact” legislative efforts underway in Congress. Some housing-finance watchers have warned that Fannie or Freddie could require taxpayer funds if a corporate tax cut, supported by Donald Trump’s administration, passed Congress. Such a cut could lower the value of assets the companies have to offset taxes.

The decline in homeownership rates to near 50-year lows is partly to blame for the U.S. economy’s sluggish recovery from the last recession, new data suggest, the Wall Street Journal reported today. If the home-building industry had returned to the long-term average level of construction, it would have added more than $300 billion to the economy last year, or a 1.8 percent boost to gross domestic product, according to a study expected to be released today by the Rosen Consulting Group, a real estate consultant. In 2016, total spending on housing declined to 15.6 percent of GDP, a broad measure of goods and services produced across the U.S., compared with a 60-year average of nearly 19 percent. The share of spending specifically linked to new-home construction and remodeling likewise declined to 3.6 percent of GDP, just over half its pre-recession peak in 2005.

Wells Fargo & Co., Royal Bank of Scotland Group Plc and Deutsche Bank AG have reached a $165 million class-action settlement of investor claims over their underwriting for the now-bankrupt subprime lender NovaStar Mortgage Inc., Reuters reported today. The accord, requiring approval by U.S. District Judge Deborah Batts in Manhattan, resolves claims that offering materials prepared by the banks misled investors into believing that loans underlying roughly $7.55 billion of NovaStar mortgage-backed securities they bought were properly underwritten, and were safe. NovaStar had specialized in lower-quality residential mortgages, including many packaged into what proved to be risky securities issued in 2006 and 2007. The company filed for chapter 11 protection last July, and is not contributing to the payout.

The state of Kentucky’s $16 billion pension fund has long invested a portion of its assets in commercial-real-estate funds managed by private-equity firms, but lately it is more interested in funds that make loans than those that buy property, the Wall Street Journal reported today. That’s because, like many other big investors, Kentucky Retirement Systems is wary of the eight-year run of rising commercial-real-estate values. If prices fall, the thinking goes, it is less risky to be a lender than an owner of a property. “Prices are really, really stretched,” said Rich Robben, interim chief investment officer of the Kentucky pension fund. “We feel, at this point, we’re happy to lend to you and let you take the haircut.” Last year, debt funds raised $20.4 billion, up from $12.2 billion in 2015, according to data firm Preqin. Big real-estate fund managers Blackstone Group LP, KKR & Co., Kayne Anderson Real Estate Advisors, Och-Ziff Capital Management Group LLC and Mesa West Capital all closed a debt fund in the past year or started raising one.