Trepp LLC's February 2011 U.S. Delinquency Report has determined that the U.S. commercial mortgage-backed securities (CMBS) delinquency rate rose again in February, with the percentage of loans 30+ days delinquent, in foreclosure or REO climbing five basis points (bps) to 9.39%, the highest in history for U.S. commercial real estate loans in CMBS. However, Trepp adds that this increase is one of the smallest month-over-month increases since the beginning of the credit crisis over two years ago.Â
‘The faith that investors have shown in the legacy U.S. CMBS market over the last few months was validated in February, as the overall delinquency rate had one of its smallest increases in nearly two years,’ says Manus Clancy, managing director. ‘While we expect the delinquency rate to continue to climb slightly higher, this may be the first real sign that the peak is near.’
The value of delinquent loans now exceeds $61.8 billion, according to Trepp. The industrial, office and retail sectors boosted the overall delinquency rate in February by 32 bps, 22 bps and nine bps, respectively.
The multifamily sector improved by 24 bps, and the lodging sector improved by 47 bps. But these remained the two worst-performing sectors, according to Trepp, with delinquency rates of 16.6% and 14.61%, respectively.
Separately, the Mortgage Bankers Association (MBA) released its Commercial/Multifamily Delinquency Report for the fourth quarter of 2010. According to the MBA, the fourth-quarter 2010 delinquency rate for commercial and multifamily mortgages held by banks and thrifts was 2.39 percentage points lower than the series high of 6.58% reached in the second quarter of 1991.
The MBA also says the delinquency rate for commercial and multifamily mortgages held in life insurance company portfolios was 7.18 percentage points lower than the series high of 7.37%, reached during the fourth quarter of 1993, while the rate for multifamily loans held by Fannie Mae rate was 2.91 percentage points below the series high of 3.62%, reached during the fourth quarter of 1991. The rate for multifamily loans held by Freddie Mac was 6.50 percentage points lower than the series high of 6.81%, reached in 1992.
SOURCES: Trepp LLC, Mortgage Bankers Association
