The U.S. commercial mortgage-backed security (CMBS) rate rose again in January, with the percentage of loans 30 or more days delinquent, in foreclosure or real estate owned climbing 14 basis points (bps) to 9.34%, Trepp LLC reports.
That is the highest delinquency rate in history for U.S. commercial real estate loans in CMBS. The value of delinquent loans now exceeds $61.4 billion.
"While the rate continues to head higher, optimists can point to the fact that the rate of increase is significantly smaller than it was in the prior two months," says Manus Clancy, managing director at Trepp. The rate of increase has averaged 25.3 bps per month over the previous 12 months (after removing the Stuyvesant Town impact in March and the Extended Stay Hotels impact in October).
"Pessimists can counter that the jump comes despite the fact that new issues continue to make their way into the calculation and servicers continue to resolve troubled loans,’ Clancy adds.
The new deals – which theoretically should have low delinquencies for a while – will continue to put downward pressure on the rate as issuance continues to grow this year, Trepp says.
The resolution of troubled loans will also help to reduce the rate, Trepp adds.
By property type, the office sector is performing best, with a 6.88% delinquency rate. The industrial and multifamily sectors continue to underperfom, Trepp says, logging rates of 10.12% and 16.85%, respectively. The delinquency rates for the hotel and office sectors stand at 15.08% and 6.88%, respectively.
To view the Trepp report in its entirety, click here.
SOURCE: Trepp LLC
