The delinquency rate for commercial mortgage-backed securities has begun to stabilize, Fitch Ratings reports. While analysts had forecast the delinquency rate to soon hit 10%, late pays fell two basis points to end March at 8.74% – the first decrease since October 2010, when the massive Extended Stay America loan was resolved.
‘Preliminary indications on year-end 2010 financials that have come in thus far are somewhat encouraging,’ says Fitch managing director Mary MacNeill. ‘Net-operating-income declines have slowed or reversed, which, coupled with stronger market liquidity, and new CMBS issuance, should continue to help slow the rise in CMBS delinquencies going forward.’
Fitch expects delinquencies to rise this year, albeit at a slower rate than previously projected. By property type, multifamily still commands the highest rate, at 17.42%. That is less than the 17.58% recorded one month earlier.
Hotels have the second-highest delinquency rate, at 14.12%, which is down from the 14.33% recorded at the end of February.
SOURCE: Fitch Ratings
