With $1.7 billion in loan resolutions offsetting $1.6 billion in new troubled loans in October, the delinquency rate for commercial mortgage-backed securities (CMBS) fell four basis points (bps) last month to 8.56%, according to Fitch Ratings.
The rating agency has observed several positive trends in this arena, including the increasingly sporadic reporting of large-loan defaults. October's new delinquencies included 14 loans with a balance of $25 million or greater (only one of which had a balance north of $100 million), which is in step with the previous two months.
This compares to an average over the preceding two years of 24 loans per month with a balance of $25 million or greater (of which, on average, three have had a balance of at least $100 million), Fitch says.
Also encouraging is the fact that fewer 30-day delinquencies are in the pipeline. As of October, $1.5 billion of loans with an average balance of $8 million were 30 days delinquent, compared with $2.2 billion in September. According to Fitch, $790 million of the 30-day total consisted of loans that were already 30 days or more past due one month prior (and, in some cases, showed month-over-month improvement).