The U.S. commercial mortgage-backed securities (CMBS) delinquency rate rose again in December, with the percentage of loans 30 or more days delinquent, in foreclosure or real estate owned climbing 27 basis points (bps) to 9.20% – the highest in history for U.S. commercial real estate loans in CMBS, Trepp LLC reports. The value of delinquent loans now exceeds $61.5 billion, the data provider says.
The decline in the delinquency rate in October 2010 now appears to have been a blip, as the rate has since increased by 62 bps. December's 27-bp jump comes despite the fact that new issues continued to make their way into the calculation and servicers continued to resolve troubled loans.
The new deals – which, theoretically, should have low delinquencies for a while – will continue to put downward pressure on the delinquency rate as issuance continues to grow this year, Trepp says. Similarly, the resolution of troubled loans will also help to lower the rate.
"Many have speculated that between the emergence of new CMBS lending, the resolution of many troubled CMBS loans and an uptick in trophy property sales, that the commercial real estate crisis was nearing its final stages," notes Manus Clancy, managing director at Trepp. "The December delinquency rate underscored that there still may be some nasty surprises in store, even as the market shows some signs of healing."
To view Trepp's complete report, click here (pdf).
SOURCE: Trepp
