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CRE Mortgage Delinquencies Rose Slightly in Q3
Delinquency rates for mortgages backed by commercial properties increased slightly during the third quarter of 2024, with office posting the largest quarterly increase. That’s according to the Mortgage Bankers Association’s (MBA) latest commercial real estate finance (CREF) Loan Performance Survey. Overall, the delinquency rate increased to 3.2% from 3% in Q2.
By property type, office loans had the highest delinquency rate as Q3 ended, rising to 7.8% from 7.1% in Q2. Multifamily saw a 10-basis-point increase to 1.2%.
However, delinquencies dropped for loans backed by lodging, retail and industrial properties. By contrast, retail delinquencies exceeded 10% during the pandemic, while those for lodging—still in second place currently with a 5.6% delinquency rate—peaked above 20% in that time period.
“The commercial mortgage market is large and diverse, covering a range of property types, sizes and ages, geographic markets and submarkets, borrower types, vintages and more,” said Jamie Woodwell, MBA’s head of commercial real estate research. “Each of those differences is affecting loan performance, some to the good and some to the bad.”
- ◦Financing
