The percentage of commercial real estate loans paying off on their balloon date last month hit the highest level since December 2008, according to new data from Trepp LLC.
Trepp reports that 68.2% of loans reaching their balloon date in September paid off, up almost 20 points from the August reading and over 40 points from the July number. Only since 2009 has the payoff reading exceeded 60%. However, Trepp adds that by loan count (as opposed to balance), 49.6% of loans paid off. On the same basis, the 12-month rolling average is now 52.8%.
‘Prior to 2008, the monthly payoff percentages were typically well north of 70 percent,’ says Trepp. ‘Since the beginning of 2009, however, there have only been five months in which more than half of the balance of loans reaching their balloon date actually paid off.’