CRED iQ Reports 78-BP Increase in CMBS Distress Rate for May

CRED iQ’s overall CMBS distress rate, which combines special servicing transfers and loan delinquencies, rose to 11.86% in May 2026, up from 11.08% in April. The 78-basis-point increase was due to both special servicing and delinquency moving higher across the conduit and SASB universe, according to CRED iQ. 

The reversal erased April’s brief improvement and pushed distress back toward the cyclical highs that have been observed over the past 12 months. “Viewed over a longer horizon, the trajectory is unmistakable: the overall distress rate has more than doubled since mid-2022, when it sat near 5%, underscoring that resolution activity is not yet keeping pace with new transfers into distress,” CRED iQ reported.

Within the overall distress rate, the special servicing index is approximately 170 bps higher than the delinquency rate. This gap, according to CRED iQ, “signals that a meaningful share of distressed balance is being actively worked out by servicers before, or instead of, becoming payment-delinquent. For investors and lenders, that spread is a leading indicator worth monitoring as 2026 and 2027 maturities approach.”